What the calculator works out
"0 % installments" is not a zero rate - it is a rate that was not called a rate. You still pay for the money, it is just hidden in one of two places:
- In the price of the item. The phone costs 20 000 ₴ in cash and 23 000 ₴ in installments. No interest anywhere, and an overpayment of 3 000 ₴.
- In a monthly fee. The price is the same, but the bank charges, say, 1.9 % of the purchase every month. Over a year that is 22.8 % on top of the price.
The calculator converts both into an effective annual rate - the same APR loans are measured by. That is the only way to put an installment plan next to a bank's rate honestly.
What each field means
- Cash price - what the item costs if you pay at once. It is the baseline: if the shop quotes one price for both ways of paying, that price goes into both fields.
- Price in installments or the fee - depending on where the overpayment sits.
- Number of payments - how many months you will be paying.
- Down payment - paid at once and not part of the plan.
- Loan rate to compare with - the NBU average on consumer credit is filled in; put your own bank's rate there if you know it.
An example: a 20 000 ₴ item with a 3 000 ₴ markup
Ten payments of 2 300 ₴ and an overpayment of 3 000 ₴ - that is 15 % of the price, but not 15 % a year. You give the money back gradually, so on average you are using about half of it, and the true rate comes out at 36.48 % a year.
The same item on a loan at 36.91 % (the NBU average) over the same ten months: a payment of 2 353.69 ₴, an overpayment of 3 536.92 ₴ and an effective rate of 43.84 %. Here the installment plan beats the loan by 536.92 ₴ - and that is a perfectly normal outcome: a 15 % markup over ten months is simply less than the market rate.
Now a 1.9 % monthly fee
The same 20 000 ₴ over 12 payments, with the fee: a payment of 2 046.66 ₴, an overpayment of 4 560 ₴ and an effective rate of 47.82 % a year. A loan on the same terms would have cost 4 220.17 ₴ - less.
The fee is expensive precisely because it is charged on the whole purchase every month rather than on what is left. By the tenth month you owe almost nothing and still pay what you paid in the first.
A down payment makes the plan dearer
It is counterintuitive, but when the markup in the price is fixed, a down payment does not shrink it. The same 3 000 ₴ of overpayment spread over 15 000 ₴ of financing instead of 20 000 ₴ pushes the rate from 36.48 % to 50.41 % a year. Paying a deposit makes sense only when the shop cuts the markup in proportion; if it does not, either pay in full or pay nothing up front.
Beyond the numbers
Paying an installment plan off early usually saves nothing: the overpayment is already baked into the payments rather than accrued on the balance. Check the contract for insurance and "mandatory services" too - they are not in the price the calculator sees, but they are in the payment.
And the main thing: do not compare "0 %" with a loan's rate, compare one effective rate with another. For a loan it is worked out by the loan calculator, for an installment plan by this page.