InCred Business Loan EMI Calculator

The Equated Monthly Instalment (EMI) for an InCred Business Loan is calculated using the following formula:

EMI = [P × R × (1+R)^N] / [(1+R)^N - 1]

Where:

• P = Principal (loan amount)

• R = Monthly Interest Rate (annual interest rate divided by 12)

• N = Loan Tenure in Months

Example
Say you take a business loan of ₹3 Lakhs at an annual interest rate of 24% for 60 months.

• Loan Amount (P): ₹3,00,000

• Monthly Interest Rate (R): 24% /12 = 0.02

• Loan Tenure (N): 60 months

For a loan with these terms, the EMI comes to approximately ₹8,630. This gives you a clear idea of the monthly repayment you’ll need to plan for throughout the loan term.

Using the business loan EMI calculator on Bajaj Markets is simple. Follow these steps to estimate your monthly instalments:

1. Enter the desired loan amount

2. Provide the applicable annual interest rate

3. Choose the repayment tenure

The calculator will then display the EMI, total interest, and the overall repayment amount so you can plan repayment effectively. 

Several elements determine the instalment amount of a business loan. Understanding these factors enables you to select a loan structure that aligns with your business objectives.

• Loan Amount

The principal plays a direct role in influencing your EMI. While a higher loan amount provides greater capital for business growth, it also increases monthly repayment commitments. On the other hand, a smaller loan reduces your EMI burden but may restrict opportunities.

• Interest Rate

The interest rate significantly impacts the affordability of your loan. Higher rates increase EMIs and overall borrowing costs, whereas lower rates make repayment more manageable. Lenders typically decide the rate based on your creditworthiness, business performance, and prevailing market conditions.

• Loan Tenure

The repayment duration that you choose influences both your monthly instalments and the total interest payable. Longer repayment periods lower EMIs and ease cash flow, but increase the cumulative interest you pay. Shorter tenures raise monthly obligations but reduce the overall cost of borrowing.

• Credit Score

Your credit score reflects financial reliability and directly affects the terms of your loan. A high credit score increases your chances of getting lower interest rates, which leads to reduced EMIs.

Conversely, a weaker score may result in higher interest charges and stricter conditions, as lenders carefully assess past repayment history and outstanding liabilities.

• Business Revenue

The revenue generated by your business demonstrates your repayment capacity. Consistent and higher earnings often lead to more favourable loan terms with competitive interest rates and manageable EMIs. Businesses with irregular or lower revenue may need to pay higher interest and thus, larger instalments.

• Processing Fees and Other Charges

Additional costs, such as processing fees or administrative charges, add to the overall loan expense. While these charges may seem minor, they increase the overall cost of the loan and your EMIs. Make sure to consider them. 

• Prepayment and Repayment Flexibility

The ability to make part-prepayments or use other flexible repayment options can lower the outstanding principal and reduce future EMIs. However, certain loans may include prepayment penalties, so understanding the terms in advance is essential.