Find Out Your Business Loan EMI with Calculator in Minutes
Business Loan EMI Calculator
Use the Business Loan EMI Calculator and speculate your EMI on a business loan. Check how Interest Rate and Loan Tenure affects your Business Loan EMI. Business Loans are essential to operate a successful business. Although there are many forms to raise capital, taking a business loan is the most common. However, many organizations are available to provide business loans in the market. As you know, business loans are very high to meet the necessary requirements for running a business. Hence, it is equally important to see the information regarding the EMI on the business loan amount beforehand. Therefore, to provide proper guidance to potential customers who are taking a business loan, organizations and banks have built up Business Loan EMI Calculator. With the assistance of the same business loan EMI calculation, you will be able to plan a monthly budget to repay the loan amount as per your capability. As a matter of fact, defaulting on any loan has an adverse effect on your credit score and eligibility for a future loan.
Loan Calculator
There are three pieces of information that are compulsory to determine business Loan EMI.
Loan Amount: The amount of money you are required to borrow is the primary factor for calculating the business loan EMI. This illustrates that the loan amount is directly proportional to the EMI. Hence, opt for a loan amount required explicitly for business workflow so that you will be able to pay the recurring EMI amounts without any financial burden.
Loan Tenure: This is the second important factor in speculating business Loan EMI. The loan tenure specifies the actual time you will get to repay the business loan with the ascertained EMI amount. The longer the assignment of a business loan, the lower the EMI amount will be, as the loan tenure is inversely proportional to the EMI amount.
Rate of Interest:
After specifying the loan amount and the loan tenure, the next factor determining the EMI calculation is the interest rate. The interest rate is directly proportional to the EMI, which is based on your credit score, income, turnover of the business, and repayment capability. That suggests that the higher the interest rate, the higher the EMI amount.
Once you have all the information mentioned above, you’ll be able to calculate your monthly installment payable on the loan amount.
Benefits of Using Business Loan EMI Calculator
There are several benefits of calculating your EMI on your business loan amount beforehand, some of which are mentioned below.
Save tedious calculations and time: Those days are gone when you had to use paper and a pen to figure out what the monthly payments would look like. With the help of this EMI calculator, you can save precious time and hard work. It can determine your EMI account in seconds with efficiency and accuracy.
Visualization benefits: Using this straightforward calculator to find business loan EMI can reduce your doubts and insecurities in half. It provides informative pie charts and tables to create a proper visualization of the actual scenario of taking business loans. So that you can be confident while planning on borrowing a business loan.
Assists in financial planning: Doing business is very uncertain, and there is no way of knowing what will happen. Financial decisions are pretty hard as they involve large amounts of money and the implications of non-payment for a business loan which is not the same as for an individual loan. As a result, If you already know how much you will have to pay every month for the EMI and what the total interest amount on your loan amount is going to be. Then planning out the finances and making decisions will be easier.
Business Loan Interest Rate Offered by Different Banks/NBFCs – December 2022
Bank/NBFCs Names | Interest Rate |
ICICI Bank | 17% onwards |
HDFC Bank | 10.00% – 22.50% p.a. |
FlexiLoans | 1% per month onward |
ZipLoan | 1% 1.5% per month (Flat ROI) |
Axis Bank | 14.65% – 18.90% p.a. |
IDFC First Bank | 14.50% onwards |
Kotak Mahindra Bank | 16% – 19.99% |
Fullerton Finance | 17% – 21% |
Bajaj Finserv | 15% – 25% p.a. |
RBL Bank | 17.50% – 25% p.a. |
Indifi Finance | 1.5% – per month onwards |
Lendingkart Finance | 1.5% – 2% per month |
Tata Capital Finance | 19% p.a. onwards |
NeoGrowth Finance | 19% – 24% p.a. |
Hero FinCorp | Up to 26% p.a. |
Business loan interest rate is updated as of 1st December 2022
Calculation of Business Loan EMI
You can easily calculate the total amount of EMI you have to pay on a certain principal amount with a fixed rate of interest and the tenure for repaying the total amount with interest.
For instance, let’s see the below table to understand better.
Required information:
Principal Amount – Rs 4, 00,000
Interest Rate – 15% p.a.
Tenure – 3 years, 4 years, 5 years
Loan Tenure | 3 years (In Rupees) | 4 years (In Rupees) | 5 years (In Rupees) |
EMI amount for a loan amount of Rs 4 lakhs at a 15% interest rate (Monthly) | 13,866 | 11,132 | 9,516 |
Total amount need to pay, to the loan provider (Principal amount + Interest amount) | 4,99,181 | 5,34,350 | 5,70,958 |
Total Interest amount you need to over loan tenure | 99,181 | 1,34,350 | 1,70,958 |
In this case, if you borrow a business loan of 4 lakhs rupees at a 15% interest rate, then the monthly payment of the EMI will be Rs 9,516 for five years of tenure. However, for the total EMI for the assignment of 5 years, you have to pay a sum of Rs 1, 70,958.
On the other hand, if you take a business loan of 4 lakhs rupees at 15% of interest, then the monthly EMI amount will be Rs 13,866 at three years of loan tenure, and the total EMI will be Rs 99,181.
This illustrates that the higher the loan tenure, the higher the interest amount (EMI). So it would be best if you were always careful while opting for the best business loan package. As a result, to plan the financial structure for your business, use the business loan EMI calculator for optimum accuracy and efficiency without any hassle.
Relationship between Loan Amount, Tenure, and Interest Rate with EMI
There are several factors that link loan amount, tenure, and rate of interest with EMI. Read below for detailed information.
The loan amount is directly proportional to the EMI amount because when you choose a higher principal amount, then the amount of EMI will also be higher. If the loan amount is lower, the EMI amount will be lower.
In the case of loan tenure, when you opt for a higher time period to repay the loan amount, then the EMI amount will be lower. In addition to this, if you choose lower loan tenure, then the EMI amount will be higher as the loan tenure is inversely proportional to the EMI amount.
The interest rate is the same as the loan amount and is directly proportional to the EMI amount.
Now let’s move ahead to see the manual formula to calculate the business loan EMI and the algorithm used by the business loan EMI calculator.
Formula Used to Calculate Business Loan EMI
You can also determine business loan EMI using the formula described below.
EMI = P x R x (1+R) ^n/ ((1+R) ^n-1)
Here,
P denotes the Principal Amount
R represents the Rate of Interest per Month
“n” denotes the tenure approved by the bank
It is quite difficult to compute the EMI amounts by using manual calculation. Therefore, it is advised that you use a business loan EMI calculator for better evaluation and accuracy of EM
Frequently Asked Questions
You can avail of a loan from a bank or a financial body to raise funds to start your own business or expand your current business. The interest rate charged by the bank will depend on the loan amount, and the repayment tenure opted by you.
You cannot borrow a loan for a grocery store from a traditional bank because traditional loans are inaccessible to small businesses due to a lack of documentation or credit history. However, these kinds of enterprises can apply for grocery store business loans. These loans have a quick, easy application process and require minimal documentation.
Chances of ruining CIBIL Score are the most apparent consequence of defaulting on loan payments. Most lending agencies require borrowers to have a CIBIL score of 750 or more to be eligible to apply for a loan. Missing even 1 EMI payment can result in the borrower’s credit score dropping 50 to 70 points.
Your monthly EMI will be Rs11, 132. To calculate the EMI by yourself, you can use the Business Loan EMI Speculator. It allows you to calculate your EMI with reliability and accuracy.
With the assistance of a business loan EMI calculator, you can check the monthly loan amount, whether your business can quickly repay that, and whether you qualify for the loan (provided all other non-financial eligibility requirements are met.
MSME loan interest rate is a fee from the lender for the purpose of a business loan given to any Micro, Small, or Medium Enterprise.
The EMI amount will stay the same once you have locked in on a loan amount, rate of interest, and loan tenure. However, the Government can change the interest rate if required. In that case, your EMI amount can be changed.
Most banks and financial institutions allow you to repay your monthly EMIs online through direct methods such as debit or electronic clearing service (ECS). Alternatively, you can pay your EMI with cheques and deposit them at your nearest branch.
