EMI vs. Lump Sum Payments for Surgery: Pros and Cons to Consider

In This Article

EMI vs. Lump Sum Payments for Surgery: Pros and Cons to Consider

Alisha Shaji

Alisha Shaji

Updated on May 21, 2024

Medically verified by Dr. Arya

Fact checked by Dr. Pournami

Financial Wellness

6 min read

Though we are familiar with the term EMI, many of us are not aware that it can also be used to meet medical expenses.

Which of the two is better according to you in case of a surgery? EMI Payments or Lump Sum Payments?

Are you confused between the two? Nothing to worry about as Mykare Health is here to help you.

This article attempts to discuss the merits and demerits of the two methods so you can finalise which one is apt for you without any external interference.

As we all know surgeries are quite unexpected and when it comes to the payment for surgeries, both EMI and Lump Sum Payments have their own advantages and disadvantages which should be taken into consideration before finalising the mode of treatment.

First thing first, let’s see what EMI and lump sum payment are about.

EMI (Equated Monthly Instalment)

  • EMI is a financial arrangement where a borrower pays off a loan or debt in fixed monthly instalments over a predetermined period. Each instalment consists of both principal and interest components, ensuring that the debt is fully repaid by the end of the term.

  • EMI is commonly used for various purposes, including purchasing goods, paying for services, or financing significant expenses such as surgeries.

  • It offers borrowers the flexibility to spread out payments over time, making large expenses more manageable and affordable.

  • However, borrowers should consider the total cost, including interest charges, and ensure they can afford the monthly payments before committing to an EMI plan.

Lump Sum Payment

  • It involves paying the entire cost of a service or product upfront in a single, one-time payment.

  • This payment method requires the payer to provide the full amount at the time of purchase or service delivery, without spreading payments over time.

  • Lump sum payments are often preferred for their simplicity and potential cost savings, as they may come with discounts or incentives from the seller or service provider.

  • However, they can also pose challenges for individuals who may not have immediate access to a large sum of money, potentially leading to financial strain or limiting their ability to afford the expense.

  • Overall, lump sum payment provides a straightforward and immediate way to settle financial obligations, while requiring careful consideration of one's financial circumstances and priorities.

Pros and Cons of EMI

Merits of EMI. When talking about the prons the first thing that comes to our mind is nothing other than the affordability to be more clear: BOX

  • Affordability : As the total amount is splitted equally into fixed tenure the financial burden reduces and can lead a happy life as it eases financial burden. It makes expensive financial procedures not only affordable but also accessible.

  • Flexibility : The outstanding feature is that the patient has the freedom to choose the repayment considering his or her financial stability. This reduces the stress of repayment.

  • Instant Payment: Fortunately with the help of EMI the poor and needy patients can effectively manage the cost of their surgery without any delay which ensures the quality of treatment and plays a vital role in determining the life expectancy of the patient.

  • No interest : Majority of the lenders offer no cost emi, which will help the individual to manage the financial condition and reduce the financial burden.

As there are two sides for a coin, there are some cons for EMI too which can't be ignored

  • Longer Payment Duration : As the payment is extended throughout several months in some cases years which leads to a long term financial commitment which eventually leads to stress and strain

  • Dependency : There is an increased chance that some individuals may get depended on EMI which severely affects their quality of living and their savings.

  • Accused Interest : Majority of the plans come with interest when analysed in total the overall cost will be higher than the borrowed money.

  • Default Risk : Missing an EMI may lead to serious issues like adding penalty which may directly affect the CIBIL score of the individual

  • Hidden Fees: There will be Ofcourse hidden charges which may lead to unexpected expenses for the patient as well his family

  • Limited Eligibility : Another important factor which is to noted that is that not all patients qualify for the particular scheme, there are several factor that previous payment history, source of income, CIBIL score and so on.

  • Complications : sometimes it can be complicated as sometimes it causes delay in claims.

In general, opting EMI as the payment mode improves the accessibility, affordability, flexibility and financing planning of the individuals who are undergoing the treatment but one should carefully analyse the cost and risks before opting for the particular scheme.

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Merits and Demerits of Lump Sum Payment

Here are the pros:

Discounts: Many of the health care providers and hospitals give discounts for their patients who are ready to make their payment in a single instalment which can ultimately lead to saving of the total cost.

  • Financial Simplicity : Lump sum payment simplifies the various financial aspects of the surgery which eliminates the need to manage monthly payments with extra cost.

  • Quicker Procedures Scheduling : Health Care provider's often have the tendency to prioritise patients who pay forehand which eliminates the lag that arrives before surgery.

  • Avoids Interest Charges : By paying the total amount in a single time the individual can avoid the hidden charges and the interest associated with it.

  • No Default Risk : There will not be any risk associated with repayment like delayed payment or reduction of CIBIL score.

Now let’s see the cons of lump sum payment.

  • Financial Strain: For the majority of patients paying full amount can lead to financial strain or hardships especially if the clients are not financially sound.

  • Limited Access : Patients who are financially unstable may face barriers for getting access to quality and timely treatments.

  • Unexpected Cost : In many cases some additional cost may arrive at the post surgical period which leads to financial trouble.

Overall lump sum payment offers financial benefits and convenience. There are some factors like limited access and financial strain which makes lump sum payment not suitable for everyone.

Both lump treatment and EMI has its own merits and demerits. So we are of the opinion that it is the duty of the individual to develop an understanding about both treatments by clearly analysing one's financial stability, urgency of the procedure.

We stick on to prioritise health by laying emphasis also on financial well being.

Key Takeaways

Opting EMI as the payment mode improves the accessibility, affordability, flexibility.

There are definitely financial risks associated with EMI.

lump sum payment offers financial benefits and convenience.

There are some factors like limited access and financial strain which makes lump sum payment not suitable for everyone.

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