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IDFC First Business Loan EMI Calculator India Apr 2021

Business Loan EMI Calculator IDFC First Bank

Last Updated 12th Feb 2021

Get monthly EMI as low as ₹ 3,151 per lakh on IDFC First Bank business loan. Business loan EMI in IDFC First Bank depends upon loan annual turnover, gross receipts, number of years of ITR, loan amount, loan tenure and interest rate.

Loan Amount1 Year Loan2 Year loan4 Year loan
₹ 1 Lakh₹ 9,359₹ 5,188₹ 3,151
₹ 5 Lakh₹ 46,797₹ 25,939₹ 15,753
₹ 10 Lakh₹ 93,594₹ 51,878₹ 31,506
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Business Loan Calculator IDFC First Bank

  • Business loan EMI (or equated monthly installment) is a fixed amount of money paid by you to IDFC First Bank against the loan taken. This is towards repayment of your loan to the bank. Every month, it is due on a fixed day of the month till your loan is fully paid back.
  • IDFC First Bank offers business loans with loan tenure up to 48 months that translates into a lowest loan EMI of ₹ 3,151 per lakh, which makes it affordable for business loan borrowers. Lowest Rate of interest offered by IDFC First Bank on business loan is 22.00%.

Use EMI Calculator to Calculate your EMI on Business Loan at Different Tenure

Business loan EMI for ₹ 10 Lakh loan amount at lowest 22.00% interest rate offered by IDFC First Bank for different tenures

1 year 2 year 4 year
IDFC First Bank EMI for loan amount of ₹ 10 Lakh at 22.00% ₹ 93,594 ₹ 51,878 ₹ 31,506
Total amount you pay back to the bank including principal and interest ₹ 12,38,825 ₹ 15,34,687 ₹ 23,55,263
Interest you have to pay over loan tenure ₹ 2,38,825 ₹ 5,34,687 ₹ 13,55,263
  • The above table shows the longer your loan tenure, lower is the EMI you pay on the loan. However, your total interest outgo is significantly higher in a long tenure loan. In the above example, if you take ₹ 10 Lakh loan for a period of 4 years, you pay the lowest EMI of ₹ 31,506. However, you pay an interest of ₹ 13,55,263 on a ₹ 10 Lakh loan.
  • In contrast, if you take a ₹ 10 Lakh loan from IDFC First Bank at the lowest loan rate offered for a period of 1 year, you pay a higher loan EMI of ₹ 93,594 and pay an interest of only ₹ 2,38,825 which is less than half of what you paid in a 4 year loan. Hence, it is advisable to choose your loan tenure wisely as longer tenure means high interest expenses.

Factors affecting IDFC First Bank Business Loan EMI

  • Loan amount - This is the amount borrower promises to repay to the bank with the interest applied. IDFC First Bank gives minimum business loan of ₹ 1,00,000 up to an amount of ₹ 9,00,000.
  • Interest rate - Interest rate is the rate charged over the principal amount borrowed. Higher interest rate increases your loan EMI which will increase the total cost of the loan. Lowest interest rate offered by IDFC First Bank is 22.00%. Do complete market research and compare rates online before you apply for a business loan.
  • Loan tenure - This is the period in which you can repay your business loan to the bank. Longer loan tenure means lower loan EMI. Generally, IDFC First Bank offers business loan for a maximum tenure of 48 months.

Business Loan Amortization Calculator

An amortization schedule is a table of periodic loan payments that shows the amount of principal and the amount of interest that comprise each payment until the loan is paid off at the end of its term.

In the Amortization schedule, your Business Loan monthly EMI will be equal, but the component of EMI, which consists of interest payment and principal payment will not remain the same every month, it keeps on changing.

Illustration: How to read an amortization schedule

Suppose if you take a Business Loan of ₹ 6 Lakh for 4 years at an interest rate of 13.50%. EMI calculated for this loan amount is ₹ 16,246 and the total annual EMIs to be paid annually is ₹ 1,94,950. The EMI schedule of loan for 4 years is explained below in the table –

Amortization Schedule for a Business Loan of ₹ 6 Lakh over the 4 years

Year Interest paid during the year Principal repaid during the year Total amount paid during the year (Interest + Principal) Outstanding Principal
2021 ₹ 56,802 ₹ 89,411 ₹ 1,46,212 ₹ 5,10,589
2022 ₹ 60,832 ₹ 1,34,117 ₹ 1,94,950 ₹ 3,76,472
2023 ₹ 41,563 ₹ 1,53,387 ₹ 1,94,950 ₹ 2,23,085
2024 ₹ 19,525 ₹ 1,75,424 ₹ 1,94,950 ₹ 47,661
2025 ₹ 1,076 ₹ 47,661 ₹ 48,737 -₹ 0

Each Business Loan EMI consists of both amounts of interest as well as the principal repaid. The interest component of EMI goes down while the principal component goes up in both cases while doing the calculation.

In the above illustration, on a Business Loan of ₹ 6 Lakh, taken at the lowest interest rate of 13.50%, EMI paid is ₹ 16,246 and an annual total of EMIs is ₹ 1,94,950, the interest component is ₹ 73,678 while the principal component is ₹ 1,21,271 in year 1 of loan disbursement. You repay only 20.21% of the total principal after paying 12 EMIs during the first year.

In year 4, the interest component of EMI is around 6.94%, while the principal component is around 93.06%. Upto 4 years, you have cumulatively repaid 100% of your total Business Loan.

IDFC First Business Loan Calculator Formula

P*r* (1+r)^n/([(1+r)^n]-1)
Here is an illustration of how IDFC First business loan EMI is calculated:
In above formula,
P = Loan amount. This can range from ₹ 1,00,000 to ₹ 9,00,000
r = Rate of interest per month. Current rate is 22.00%
n = tenure in month. For IDFC First, this can be 48 months

Tips to decide the right amount of IDFC First Bank Business Loan EMI

  • Ascertain the amount you need to borrow: It is important that before approaching IDFC First Bank for business loan, you need to estimate the amount of loan you need to borrow. Remember business loan is an unsecured short term loan, and hence it is advisable to minimize your loan amount to the extent possible. Also, based on the EMI you can service, try to opt for lowest tenure of loans as long tenure loans result in huge interest outgo.
  • Review your current obligations: Before taking loan from IDFC First Bank, it is advisable to do an evaluation of your current monthly expenses including any EMI obligations that you have on your current loans. The assessment will help you to estimate the amount of EMI you can pay comfortably after taking into account other obligations. Once you arrive at the EMI you can service, you can also decide on the right loan tenure.

FAQs

What is the calculation of IDFC First Bank Business Loan EMI?

Business Loan EMI (or equated monthly installment) is a fixed amount of money paid by you to IDFC First Bank against the loan taken. This is towards repayment of your loan to the bank. Every month, it is due on a fixed day of the month till your loan is fully paid back.

  • Business Loan EMI (or equated monthly installment) is a fixed amount of money paid by you to IDFC First Bank against the loan taken. This is towards repayment of your loan to the bank. Every month, it is due on a fixed day of the month till your loan is fully paid back.
  • With IDFC First Bank offering business loan with loan tenure up to 48 months, the loan EMI can be as low as ₹ 3,151 per lakh, to make it more affordable and convenient to meet your business needs. Rate of interest offered by IDFC First Bank are as low as 22.00%. You can check EMI for other tenures using our IDFC First Bank business loan calculator.
  • This EMI consists of both interest payment and principal repayment. Though the EMI amount will remain constant, the principal component keeps increasing and on the other hand the interest component keeps reducing.

How does MyLoanCare business loan calculator calculate EMI?

This calculator calculates EMI considering a combination of loan amount, interest rate and loan tenure.

  • This calculator considers “reducing balance basis” and assumes that payment of EMI is made in arrears (means interest is charged for the month preceding the EMI payment date) and not in advance.

Will the IDFC First Bank business loan EMI remain constant or change in future? What happens in case of increase or decrease in interest rate?

Typically, the business loan EMI remains unchanged unless the customer requests for a change and the same is approved by IDFC First Bank subject to its eligibility conditions (note that nominal charges may apply for effecting a customer initiated change in EMI).

  • In case the floating rate of interest on your business loan increases, IDFC First Bank will typically keep the EMI constant but increase the loan tenure. So, you will pay the same EMI but for a longer duration. In case the interest rates increase to an extent that the revised loan tenure is more than the maximum permissible by IDFC First Bank, the bank may increase your EMI amount.
  • For partly disbursed loans availed under tranche EMI scheme, your loan EMI will increase with each disbursement.

Will business loan EMI change in case of prepayment?

IDFC First Bank allows prepayment at nil charges or penalty in case of floating rate business loans.

  • When you make a prepayment, the outstanding principal amount on your loan reduces. In this case, you may choose to either keep the EMI same and reduce the loan tenure (that is paying off the loan faster) or reduce the EMI and keep the loan tenure same (that is paying lesser amount every month). It is beneficial to keep the EMI constant and reduce the loan tenure as you pay less interest to the bank in this option.

Why should I calculate IDFC First Bank loan EMI before taking a loan?

In case EMI comes out to be more than your monthly budget, then you have the chance to apply for a lower loan amount which fits your monthly budget and makes EMI easily affordable.

  • If you already know the EMI you have to pay each month, then you can plan your expenses accordingly.
  • Based on the EMI amount, you can opt for making prepayment of your business loan in future when you have surplus amount.

IDFC First Business Loan News - Apr 2021
  • 2021-01-22 : IDFC First Bank retail loan surges 100%
    IDFC First Bank reported that its retail deposits which includes home, personal, car, two wheeler, gold and LAP increased 100% Y-o-Y. In addition to this, Customer Deposits of the Bank which includes FD and RDs increased to Rs. 77,289 Cr as on 31 December 2020 from Rs. 54,631 Cr as on 31 December 2019 . CASA ratio on outstanding deposits as on 31 December 2020 was 48.4%.
  • 2020-07-31 : IDFC First Bank Ltd Q1FY21 consolidated net profit at Rs. 100.07 crore
    IDFC Bank posted a net profit of Rs.100.07 crores for the period ended June 30, 2020, as against Rs.76.36 crores for the period ended March 31, 2020. The company bolstered by retails loans like home, personal, gold, car and two-wheeler loans along with the Business and mudra loans has reported total income of Rs.4413.19 crores during the period ended June 30, 2020 as compared to Rs.4553.07 crores during the period ended March 31, 2020.
*Terms and conditions apply. Credit at sole discretion of lender subject to credit appraisal, eligibility check, rates, charges and terms. Information displayed is indicative and from collected from public sources. Read More
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