India's credit market has steadily expanded, eventually acquiring the 4th position in the industry. As of today, it showcases an impressive compound annual growth rate (CAGR) of 11 percent, year-on-year. While India's credit industry comprises several products, it's majorly dominated by short-term credit lines such as personal loans and credit cards.
In fact, both personal loans and credit cards account for 78% of all credit lending in the country.
Speaking of personal loans, there is an increasing preference for equated monthly instalments (EMIs). And with this preference, comes a need for borrowers to consider their EMI amount carefully to plan their monthly and future expenses.
Several EMI calculators are available online, free-of-cost. However, the key is to choose an accurate CANARA BANK PERSONAL LOAN EMI Calculator and understand its functioning to calculate the instalment amount which they are liable to pay.
When planning for a personal loan, there are some important factors that you need to consider. However, your EMI is dependent on two primary aspects - financial capacity (or monthly income) and repayment capacity (can you afford to pay the amount each month).
To make things simpler, following are some factors to consider-
A loan's tenure is flexible enough to get extended or reduced. This will invariably reflect in your EMI amount i.e., decrease or increase, respectively. So, considering the tenure of a loan is also important to understand the overall loan amount.
The rate of interest is another vital factor that will help evaluate the installment amount owed. Ideally, by comparing two or more EMI options, you can opt for the scheme with a lower rate of interest along with a reasonable tenure. So that your overall repayment amount remains low.
Choosing the loan amount is also a significant factor for determining your EMI. Why? Because your EMI will be calculated based on the total loan amount that you decide to take.
To prudently calculate floating/variable rate EMIs, we recommend a dual-scenario approach: the Optimistic (Deflationary) and the Pessimistic (Inflationary) scenarios. The loan amount and tenure are aspects you determine, signifying your control over how much to borrow and the duration of repayment. However, the interest rate is influenced by banks and HFCs, rooted in guidelines from the RBI.
To make informed decisions on EMIs, loan tenure, and borrowing limits, consider these scenarios:
Imagine a decrease in interest rates by 1% - 3% from the current rate. Evaluating this scenario allows you to forecast potential EMI reductions or even opt for a shorter loan tenure. For instance, when securing a home loan for an investment property, this scenario provides insights into comparative investment avenues.
Conversely, envision an interest rate surge of 1% - 3%. Assess if the heightened EMI remains feasible for you. Even a mere 2% interest hike could substantially amplify your monthly commitments for the loan's duration.
Such evaluations are essential in pre-empting potential financial scenarios. Committing to a loan is a long-term fiscal responsibility. Hence, while it's beneficial to remain optimistic, it's equally vital to be prepared for unforeseen challenges. In essence, hope for the best but brace for every possibility.
The number of credit accounts in the country is growing rapidly, with an expected CAGR of 18.7 percent between 2022-26. In fact, as many as 73 million credit cards were issued during FY 2022 alone.
Clearly, credit usage is expanding in India and so is the preference for EMI-based loan schemes.
Irrespective of the type of loan, secured or unsecured advance, it is important for your to calculate the EMI amount beforehand. So that you are prepared for what you're getting into. That is where an EMI calculator in India enters the picture.
CANARA BANK PERSONAL LOAN EMI calculator uses a specific formula to calculate EMI amount. The formula is:
EMI = [P x R x (1+R) ^N]/ [(1+R) ^ (N-1)], where –
P = principal amount
R = rate of interest
N = loan tenure
This is the standardised formula used by any online EMI calculator. Bear in mind that some variables may change, based on the type of loan availed.
As mentioned before, India's credit industry offers a wide variety of loans, based on types, amount, tenure, etc. And accordingly, numerous types of EMI Calculators also exist online that you can use for determining your equated monthly installments.
The different EMI calculators include:
Home loans tend to have the largest/highest principal loan amount and invariably, a longer tenure. Given the huge amount to be paid, home loan requires strategic planning for its repayment. But worry not, for you can use the home loan EMI calculator to calculate your EMI.
It is a user-friendly, free-of-cost and instant-results calculator for determining your home loan EMIs immediately. All you need to do is enter all the variables including loan amount, tenure chosen and the prevailing rate of interest. Home loan EMI would be calculated instantly.
Apart from real estate, buying a car is another major investment one can make. And so, you may require a car loan to fund this considerably large amount. Often, a car loan's EMI has to be repaid with due interest within a stipulated time, usually within 7-10 years.
Failure to do so and your car can be taken away and put up for auction to recover the remaining amount. To avoid this unfortunate circumstance, you can use a car loan EMI calculator. So that you know the monetary expectations even before signing-up for the loan. The process of using the EMI calculator remains the same as home loan - enter all the variables and submit to get instant value.
Personal loans are mostly meant for funding a medical emergency, vacation, relocation, wedding, home renovation, etc. These are primarily, unsecured loans and hence, have a relatively higher interest rate along with a shorter tenure. You can use the Personal Loan EMI Calculator of StockGro to assess how high the personal loan EMI value can go.
In recent years, affording good-quality education has become an expensive affair for parents, particularly with the heightening cost-of-living. To fund this education, an education loan becomes a good option for parents. Such loans are available for education within India or overseas. By entering the loan amount, rate of interest, and loan tenure in the Education Loan EMI Calculator, you can calculate EMI value to be repaid.
A loan against property is a specific type of secured loan that you can avail while keeping your property as the collateral. This property can be residential, commercial, or land, as long as it can be mortgaged with the lender against the loan. For calculating the loan against property EMI amount, a specialised calculator is easily available online.