OK. Here's some insight into these cashback and zero cost EMI stuff. Once I was going to buy a Refrigerator at Bajaj Electronics (in Hyderabad). The original price was 1.96 L. After lot of bargaining I finally got it for 1.01L with zero interest EMI option from Bajaj Finance. I asked the store manager for further discount as I am willing to pay the whole amount in cash but he refused any further discount saying that he has no benefit even I pay it upfront. I was confused. Then, I asked Bajaj Finance guy (they have a small team inside the store selling EMI Cards and processing loans etc) how Bajaj can afford to give zero interest EMI. The secret is that it is the Manufacturer who has tie ups with the finance companies. So, here how it works.
Assume for a product worth 1,20,000 with a 12 months emi at flat rate 10% interest rate the average per month interest would come to 1,000 (assuming flat rate and not going into the actual EMI calculations for simplicity sake).
Average monthly EMI would be 1,20,000 / 12 = 10,000 Principal + 1,000 Interest.
EMI = 11,000.
Finance institution (Bajaj Finance in my case) would get 10,000 from me and 1,000 from the manufacturer. Most often the interest component from the manufacturer is paid upfront hence they pay less than 12,000 to the financial institution. I am not going into those details to avoid complicated calculations.
The store (Bajaj Electronics) would get the full 1,20,000 upfront from the finance company.
So, in reality it is the Manufacturer who is promoting the zero interest EMI and not the financial institutions. This is the reason why you only see few credit card companies and banks are part of these EMI options as it is not possible to have such a tripartite agreement with all the credit card issuing financial institutions unless there is an agreement with the gateways (VISA / MasterCard etc).
I hope this clarifies the doubts.