Calculator
Business Loan EMI Calculator
MSME/business loan rates are typically 11–20%.
Principal vs interest paid each year
- Principal
- Interest
View yearly breakdown
| Year | Principal | Interest | Total |
|---|---|---|---|
| Y1 | ₹1,48,509 | ₹1,30,710 | ₹2,79,219 |
| Y2 | ₹1,70,688 | ₹1,08,531 | ₹2,79,219 |
| Y3 | ₹1,96,178 | ₹83,041 | ₹2,79,219 |
| Y4 | ₹2,25,476 | ₹53,743 | ₹2,79,219 |
| Y5 | ₹2,59,149 | ₹20,070 | ₹2,79,219 |
Excludes processing fees (typically 1–3%), GST on charges, collateral/insurance costs, and any moratorium. CGTMSE-backed and government-scheme loans may carry different terms. Treat this as an estimate and confirm the full cost with the lender.
Business and MSME loans carry higher rates than home loans, so the EMI and total interest deserve a close look before you borrow. This calculator shows the monthly EMI, the total interest over the tenure, and the total amount repaid on a term or working-capital loan. Use it to check whether the EMI fits your monthly cash flow and to compare offers from banks, NBFCs, and MSME schemes before signing.
What your result means
- Compare flat versus reducing-balance rates carefully — a flat rate looks lower but can cost nearly twice as much, because it charges interest on the original amount throughout.
- Processing fees, insurance, and charges can add 2–4% upfront, so judge the all-in cost, not just the rate.
- Match the tenure to the life of what you are funding — a short-term need financed long, or a long-term asset financed short, both create strain.
How to use this calculator
- Enter the loan amount your business needs.
- Enter the annual interest rate the lender quotes (do not divide it yourself).
- Set the tenure in years.
- Check the EMI against your monthly cash flow — keep total EMIs within what slow months can bear.
- Compare total interest across offers; a lower rate or shorter tenure can save lakhs.
The formula
EMI = [P × r × (1 + r)ⁿ] ÷ [(1 + r)ⁿ − 1], where P = loan amount, r = monthly rate (annual ÷ 12 ÷ 100), n = months (years × 12). Total interest = (EMI × n) − P.
Worked example
A ₹10,00,000 working-capital loan at 14% for 5 years: r ≈ 0.01167/month, n = 60. EMI ≈ ₹23,268 per month. Total repayment ≈ ₹13,96,000, of which roughly ₹3,96,000 is interest. Shortening to 3 years raises the EMI to about ₹34,178 but cuts total interest to roughly ₹2,30,000 — a saving worth weighing against the higher monthly burden.
When to use it
- Sizing a term loan for equipment or expansion against monthly cash flow.
- Comparing bank vs NBFC vs MSME-scheme loan offers.
- Stress-testing whether the EMI survives a slow season.
- Deciding between a shorter, costlier-per-month loan and a longer, costlier-overall one.
Frequently Asked Questions
References & sources
How this calculator was checked: The EMI formula (standard fixed-payment amortisation formula) was checked against its derivation and re-run against the worked example on 2026-07-27 -- the Rs23,268 EMI, ~Rs3,96,000 interest (5-year) and ~Rs2,30,000 interest (3-year) figures all match the formula's actual output, so no correction was needed. Not reviewed by a registered lending adviser.