Things to Know When Buying on Installment with a Credit Card

When you need to make a purchase but don’t have enough cash or your payment card balance isn’t sufficient for the item you want, let’s explore what it means to buy on installment with a credit card and the best practices to maximize your financial benefits.

1. What is Buying on Installment with a Credit Card?

Buying on installment with a credit card is a shopping method where you do not need to pay the full amount at the time of purchase. Instead, the amount is deducted from your credit card limit and divided into smaller payments that you repay over multiple billing cycles.

2. Conditions for Buying on Installment with a Credit Card

To qualify for credit card installment plans, you must meet these conditions:

You must be the primary cardholder, and your credit card must be active.
Your card’s available credit limit must be greater than the installment amount.
The installment amount must meet the minimum requirement set by the bank (usually at least 3 million VND).
The remaining validity of your card must be equal to or longer than the installment period.
You must not have any overdue debt at the time of registration.
Your bank must support credit card installment programs.

3. Key Points to Consider When Buying on Installment with a Credit Card

Understand the installment policy: Research the installment plans offered by the retailer and your credit card issuer, including interest rates, conversion fees, installment periods, and procedures. This helps you make an informed decision and plan your repayments.
Check your credit card limit: Ensure that your installment amount does not exceed your credit limit.
Pay on time: Keep track of your installment due dates to avoid late payments and penalties.

4. Benefits of Buying on Installment with a Credit Card

Financial flexibility: You don’t need to pay the full amount upfront, reducing financial pressure.
Flexible repayment periods: Depending on agreements between the bank and retailer, you can choose installment plans of 3, 6, 9, or 12 months based on your financial capability.
Simple procedures: Unlike other installment plans, you don’t need to provide proof of income.
Wide acceptance: Most retailers that accept card payments also support installment plans.
Exclusive offers: You may enjoy cashback, reward points, or promotional discounts.
Low interest and fees: Some retailers offer 0% interest installment plans with minimal fees.

5. How to Register for a Credit Card Installment Plan

5.1. Register at the Store

Check if the retailer supports credit card installment payments.
Select the product you want to buy and ensure it meets the minimum installment amount.
Review your monthly income and expenses to choose an appropriate installment period. You can use an online installment calculator for better planning.
Register for the installment plan at the store.

5.2. Register for Installment When Shopping Online

Visit the e-commerce platform’s website or app.
Find and select the product you want to purchase (products eligible for installment plans are usually marked accordingly).
Choose an installment period that fits your budget.
Provide necessary details, such as your bank, credit card number, cardholder name, expiration date, and CVV code.
Confirm and complete the payment.

5.3. Register for Installment via Mobile Banking Apps

This is the most convenient method. After making a purchase with your credit card, you can convert the transaction into an installment plan through your bank’s mobile app. Banks typically offer two options:

Installment by transaction: You can select eligible transactions from your credit card statement and convert them into installments.
Installment by outstanding balance: You can convert part of your credit card debt into installments, provided it meets the bank’s minimum installment amount.

Before registering, ensure you review the interest rates and fees to make an informed decision.