PAN stands for Permanent Account Number and is a vital financial document needed to file taxes and do much more. A PAN Card is also considered as a proof of identity document. If you wanted to know the use of a PAN Card and why it is considered necessary for EMI transaction, then this post should help you out. Read on!
What is the Use of PAN Card?
Other than being a financial and proof of identity document, a PAN Card also has many more uses. Have a look:
- ITR filing – Individuals and entities that are eligible for income tax are required to file IT returns. You need to have a PAN Card to file for IT returns. It is the most important reason why anyone applies for a PAN Card.
- Opening a bank account – You will also need to have a PAN Card to open a bank account. All banks need you to submit the PAN Card to process your request.
- Applying for a credit or debit card – It is also mandatory for you to furnish your PAN Card while applying for a debit or credit card. It is mandatory, and your application may not be accepted if you don’t submit it.
- Jewellery purchase – If you want to invest in jewelry that is priced at Rs.5 lakh and more, then you will need to provide PAN details while making the purchase.
- Proof of identity – PAN Card is accepted as a valid identity proof all over the country. It is also taken as proof of age. You can also submit as a proof of identity while applying for a Voter ID Card, Passport, Driving License, electricity connection and more.
- Foreign exchange – When you are traveling out of the country and want to convert your Indian currency into foreign currency, then you need to provide PAN details at the counter you are converting money.
- Loans – If you wanted to apply for a loan, then banks and non-banking finance companies (NBFCs) need you to furnish PAN details while applying. Major loan types such as personal loan to education loan and more need PAN details to get approved.
- Cash deposits – If you want to deposit cash in excess of Rs.50,000 at a time, then you will need to provide your PAN details as well. It is required as per the RBI Mandate. RBI directs financial institutions to report about any large cash deposits as a measure to curb money laundering.
- Insurance payments – The Income Tax Department directs that you need to furnish your PAN details while paying for an insurance premium in excess of Rs.50,000.
Other than these usages, a PAN Card is also required while applying for telephone connections, fixed deposits, buying, selling or renting a property and other purposes.
Is PAN Card vital for an EMI transaction?
The concept of EMI payment has enabled people to divide the cost of a preferred item such as laptop, smartphone and much more over a tenor and pay in installment. This way, an individual is able to save on his savings as it is not needed to pay the entire amount at once.
PAN number is needed in the process of Know Your Customer (KYC) details. If you don’t have a valid PAN number, then your registration for the EMI truncation may not be possible. Therefore, you may not be able to avail of the EMI facility.
If you want to spread the cost of a product over a tenor and pay fixed EMIs, then it is vital to own a PAN Card to complete KYC procedures and get items without issues.