Urban Money

Business Loan EMI Calculator

  • 50 K
  • 1 Cr
Years
  • 1
  • 5
%
  • 8
  • 25

Monthly Loan EMI

Payment Breakdown:

Principal Amount

₹15,00,000

Interest Payable

Total Amount Payable

Urban Money Business Loan EMI Calculator

When taking a business loan, organisation of costs and loan repayment become a significant concern in the day-to-day operations of any company. Consequently, a major chunk of time and effort is invested in scrutinising the cost structures. However, with efficient tools such as Urban Money Business Loan EMI Calculator, one can easily bypass a lot of these efforts. Using a simple yet powerful formula, the AI-backed EMI calculator furnishes the exact amount to be paid every month against the principal business loan amount.

What is the Urban Money Business Loan EMI Calculator?

Urban Money Business Loan EMI Calculator is an intelligent tool used for computing the equated monthly instalments (EMI) for your business loan. Powered by cutting edge AI technology, it intakes a few variables, such as loan amount, interest rate and tenure, and based on a mathematical formula, computes the monthly EMIs with precision. With the help of the EMI Calculator, borrowers can get rid of major hassle involving cost estimations.

How does the Urban Money Business Loan EMI Calculator Work?

The Urban Money Business Loan EMI Calculator works on a simple and effective computing formula involving the loan amount, interest rate, and tenure. Users will have to feed in data in these fields to retrieve the tentative monthly EMIs against their business loan.

Once they click on the Calculate button, details of their monthly EMIs along with the interest rates will be displayed on the screen, along with a comprehensive comparison of interest rates offered by the top banks of India (private, public and NBFCs. It should be noted that the desired loan amount may or may not be sanctioned as it will, ultimately, depend on the preferred bank.

Note: Offering clarity and detailed analysis, the Urban Money Business Loan Calculator furnishes precise EMI results solely based on the data fed by the user. However, as interest rates vary amongst different banks, the estimations should be approached in a speculative manner.

Business Loan EMI Calculation Formula

The formula that Urban Money Business Loan EMI Calculator uses is as follows:

EMI = P x R x (1 + R) ^ T / {(1 + R ) ^ T - 1}

Here:

  • The Principal Amount is denoted by the variable P.
  • The rate of interest is represented by the variable R.
  • The tenure of the loan duration is denoted by the variable T.

The symbol ^ denotes the exponential function read as "raised to".

Let's understand the given formula with the following example. If an entity took a business loan of INR 2.5 Lakh for a period of 2 years with an interest rate of 18% p.a., the EMI would be calculated as follows:

Principal amount (P)= INR 2.5 lakh Rate of Interest (R)= 18% Tenure (T)= 2 years

Calculations based on the formula will be: P x R x (1 + R) ^ T / {(1 + R) ^ T - 1} 2,50,000 x 18% x (1 + 18%) ^2 / {(1 + 18 %) ^ 2 - 1}

The monthly EMI for a business loan of INR 2.5 lakh will be INR 12,481.

Features and Benefits of Business Loan EMI Calculator

The Urban Money Business Loan EMI Calculator offers a myriad of benefits, including the following.

  • Adopts a quick calculation process backed by AI.
  • Furnishes error-free EMI estimates.
  • Requires only three entries comprising the loan amount, interest rate and tenure, offering a more convenient, compact and hassle-free process.
  • It can be accessed from both computer and mobile phone.
  • The improved user interface of the calculator helps users get a graphical visual representation of the data making way for augmented clarity.

What are the Factors Affecting Business Loan EMI?

There are majorly three factors that affect a business loan EMI, namely the principal loan amount, interest rate, and tenure.

  • Principal Loan Amount

The principal loan amount is the desired amount borrowed from the banks. These amounts are sanctioned based on the borrowers eligibility. These eligibility factors are usually based on the borrower's creditworthiness, their repaying capacity, their performance as a company, professional experience in years, etc.

  • Interest Rates

Interest rates fluctuate depending on several factors, like government policies, demand, competition, etc. Banks usually have differing interest rates merged with several other offers. It is, therefore, advised that applicants cross-check each bank and pick the loan offer that best suits them.

  • Tenure

Tenure is another factor that will affect the EMI calculated on business loans. The thumb rule is that the more the tenure, the less will be the monthly EMI. However, it should be noted that the total repayment amount also exceeds with a longer tenure.

Comparison of Business Loans offered by Various Banks/NBFCs

Various top banks and NBFCs provide business loans at reasonable interest rates against flexible tenures. Based on individual requirements, companies can approach these banks for a business loan that would suit their needs. But it is always advised to check the eligibility beforehand via the Urban Money Business Loan Eligibility Calculator.

Below are the details of the seven top banks in India offering business loans, their interest rates, tenures, and maximum loan amounts.

S. No. Bank Name Interest Rate in % Max. Loan in Rs Max. Tenure
1. SBI 11.20% to 16.30% 100 Crores 4 years
2. HDFC Bank 16.25% 50 Lakhs 4 years
3. Kotak Mahindra 17% to 28% 75 Lakhs 5 years
4. ICICI Bank 18% 40 Lakhs 4 years
5. Bajaj Finserv 17% to 32% 45 Lakhs 7 years
6. Axis Bank 11% to 25% 50 Lakhs 5 years
7. Yes Bank 16.25% 50 Lakhs 3 years

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Frequently Asked Questions (FAQs)

How is EMI calculated for business loans?

The EMI for a business loan is calculated based on the amount borrowed, interest rate, and loan maturity duration. The general formula used to calculate the EMI for a business loan is “EMI = P x R x (1 + R) ^ T / {(1 + R ) ^ T – 1}”. Here, P is the principal amount, R is the interest rate, and T is the tenure.

Are business loans effective or useful?

From purchasing new equipment and hiring new talents to expand businesses, a business loan acts as an effective source of capital to meet any entrepreneurial requirements.

What if I get delayed in paying my business loan EMI?

Borrowers need to be careful regarding timely EMI payments as any delay can incur unprecedented penalties. A delay in EMI payment also impacts one’s credit score adversely.

Does the loan tenure affect my EMI for business loans?

Yes, the loan tenure affects the EMI for business loans as an increased amortisation period can heighten the interest amount even though it lowers monthly EMIs.