Know How To Calculate EMIs Online For a Personal Loan

As per the Reserve Bank of India, the personal loan market in India witnessed a negative growth of 9.5% in December 2020. However, the demand for small-ticket personal loans has increased exponentially. According to a report,

• Almost 67% of personal loans are extended to individuals with income below Rs.3 lakh annually, between April 2020 and December 2020. 

• The personal loan market in India is also anticipated to grow by 10% between 2021 and 2025. 

Nevertheless, while the demand for this credit continues to grow, they come with excellent repayment responsibility. Hence, it is vital for borrowers to calculate their EMIs beforehand for a hassle-free borrowing experience. 

Several financial institutions provide a financial tool like an online personal loan calculator to help borrowers make the right borrowing decision. Using this tool, they can assess if they can repay the selected loan amount efficiently or not. 

Here is a detailed process of calculating EMIs using this tool. 

How to calculate online personal loan EMI?

An online personal loan calculator allows borrowers to derive the EMI payable before applying for their preferred loan amount. 

Here is the step-by-step process that you need to follow to know your personal loan EMI. 

1. Visit the website of a trusted financial institution and navigate to a personal loan calculator. 
2. Select the amount you want to apply from the lender. 
3. Choose the tenor and interest rate.
4. Once you enter all the details, the EMI will reflect on the calculator instantly. 

Along with EMI, you can also estimate total interest payable and net loan payable at the tenor’s end. Hence, this tool helps you to manage your personal loan EMI repayment efficiently. 

Things to consider while calculating the personal loan EMIs

While an online personal loan calculator allows the borrowers to facilitate repayment, they also need to consider a few things to arrive at a favourable decision. Thus besides knowing how you can use a personal loan calculator, individuals also need to know a few vital things to make the calculation easier. 

• Individuals can adjust the principle as per their financial capacity, wherein increased loan amount means higher loan amount and vice-versa. 

For instance, when one chooses a principle of Rs.10 lakh for 36 months with an interest rate of 13.5%, the monthly instalments would be Rs.33,935. If the principle is increased to Rs.12 lakh keeping the other two components unchanged, the EMIs would be Rs.40,722. 

• Borrowers can also adjust the tenor to make their EMI affordable and within budget. However, in that case, EMI is impacted differently. 

For example, for a loan amount of Rs.7 lakh with a tenure of 36 months and a 13.5% interest rate, the EMIs would be Rs.23,755. 

If one increases the tenor to 48 months, the EMI will go down to Rs.18,953. 

However, you need to remember that the interest calculator accrual increases when you choose a longer tenor. Hence, it is crucial to calculate loan EMI to arrive at the right financial decision. It is one of the simple ways to manage debt with ease. 

Moreover, using this online personal loan calculator, individuals can compare different lenders to get the best deals as well. Select NBFCs like Bajaj Finserv extend personal loans up to Rs.25 lakh with a Flexi Loan facility. It helps them to save substantially on interest payment. 

They also provide pre-approved offers to their existing customers. These offers make loan availing straightforward and quick. Besides personal loans, such offers are also available on various financial products like business loans, credit cards and many more. All you have to do is enter your name and contact number to check your pre-approved offer instantly. 

Therefore, using an online personal loan calculator, individuals can get to know about accurate EMI payable. It helps them to repay the debt on time, improving their credit score in the process.