Business Loan EMI Calculator - Shriram City

Business Loan EMI Calculator

Loan Amount
|
1L
|
20L
|
40L
|
60L
|
80L
|
1Cr
Interest Rate
|
8%
|
12%
|
16%
|
20%
|
25%
%
Loan Tenure (Months)
|
12
|
24
|
36
|
48
|
60

Loan EMI

49,919

Total Interest Payable

69,80,529

Total Payment (Principal + Interest)

1,19,80,559

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Business_Loan_EMI_Calculator

What is a Business Loan EMI Calculator?

Like all loans, business loans involve interest and Equated Monthly Installments (EMIs). A business loan EMI calculator helps instantly calculate the EMI for different combinations of loan amounts, interest rates, and loan terms. Moreover, every EMI has an interest and a principal component. With a business loan calculator, EMI information is supplemented by other information such as total interest and principal payable and total payment to be made. A business EMI calculator has a user-friendly interface that makes sure anyone can understand the result.

How to Calculate Business Loan EMI?
Calculate_Business_Loan_EMI

The EMI calculator for a business loan in Excel uses the following formula - PMT (Rate, NPER, PV, FV, TYPE)

Where -

  • PMT = EMI payments,
  • Rate = Interest rate,
  • NPER = The number of EMIs (if it is a loan for 12 months, the NPER will be 12),
  • PV = Present value of the loan or the principal amount that one needs to borrow,
  • FV = Future value or the remaining balance after the loan payment. This value can be omitted, and
  • TYPE = When the payment is due. For EMIs, the payment is due at the beginning of each month, so TYPE is 1

However, using a business loan EMI calculator in Excel requires some knowledge of the software. For those looking at a business loan calculator in India, the small business loan calculator EMI Calculator is the best choice.

Suppose someone is taking a loan of ₹10 lacs at an interest rate of 15% for 36 months. You can calculate the business loan EMI in 3 simple steps -

Loan_amount
Loan EMI
₹ 1,82,582
Total Interest Payable
₹ 27,63,944
Total Payment (Principal + Interest)
₹ 87,63,944

Where -

  • Loan EMI = Amount payable each month
  • Total interest payable = The total interest to be paid over 36 months
  • Total payment = Including the interest payment, the borrower will repay an amount of ₹12,47,952 to the lender

The EMI of a business loan depends on three factors -

  • Loan amount or principal
  • Interest rate
  • Loan tenure

The loan amount and interest rate are directly related to the business loan EMI payable. The higher the loan amount and the interest rate, the greater the EMI will be. The loan tenure has an inverse relationship with EMI. The higher the loan tenure, the lower the monthly EMI is.

A business loan EMI calculator is programmed to calculate the EMI amount based on the user's variables. It is a business loan interest rate calculator feature that calculates the interest payable based on the principal amount, rate, and tenure. The business loan interest calculator’s results distribute the principal payment over the loan tenure. It comes up with a monthly amount payable that includes both the principal and the interest.

Whether a business is large or small, a business loan EMI calculator takes away the pain of manual calculations and provides all the necessary information related to EMIs instantly. Knowing the EMI amount helps borrowers in several ways, including:

  • Planning their funds’ outgo,
  • Comparing different loans and choosing the one that is best for their needs, and
  • Deciding on the tenor by trying multiple combinations and choosing a tenor that suits your budget for monthly EMIs.

The interest rate is a key factor in calculating EMI. If you need a business loan, choose a provider that provides the lowest interest rate. The tenure also plays a role in reducing the EMI. If you expect the liquidity crunch to continue for a time, you can opt for a higher term of 60 months to reduce your monthly outgo.

Shriram City levies the following rates and charges upon successfully taking a business loan:

Interest ratesStarting from 15%
Processing feesLess than 2%
Loan tenureUp to 60 months
DisbursementUp to 1 Crore

You are required to fulfill the following criteria to avail of a business loan -

  • Minimum turnover of ₹20 lakhs
  • The applicant must be in the same business for the past 3 years
  • The applicant should be living in the same residential address for at least 1 year
  • Valid business registration documents
  • Declaration of existing credit obligations
  • Age of the borrower
At the time of availing of the loanNot less than 23 years
At the time of maturityNot more than 65 years

You are required to provide the following documents at the time of availing of a business loan -

  • Identity proof
  • Proof of residence
  • Recent passport size color photographs
  • Proof of income
  • Declaration of existing credit obligations
  • Original documents - Collateral Security pledge / hypothecation / Mortgage - Original documents required
  • Post-dated cheques and Electronic clearing mandates (ECS)
  • Any other documents depending on the borrower’s unique situation

In case of a missed EMI payment or an ECS bounce, the borrower has to pay bounce charges of up to ₹500.

The monthly EMI is fixed throughout the loan of the tenure. However, the tenure of the loan is subject to fluctuations in market interest rates.

Knowing the EMI amount before taking a business loan helps business owners plan their finances. Whether it is meeting their short-term liquidity needs or planning big-budget capital expenditures such as purchasing plants and machinery, calculating the EMI amount prepares business owners. Knowing the EMI eliminates surprises as business owners know the amount payable in advance.

We hope this helps you understand how to calculate business loan EMI; it has been made very easy with Shriram City. If you seem to face any difficulty, do reach out to us.