Canara Bank Personal Loan EMI Calculator - Mar 2021

• Loan amount – This is the amount that you have borrowed from Canara Bank. If you apply for a higher loan amount, your monthly EMI will be high. Canara Bank gives a minimum loan of ₹ 1 Lakh, which can go upto an amount of ₹ 3 Lakh.
• Interest rate - Higher interest rate increases your loan EMI as well as the total cost of the loan. Canara Bank personal loan interest rate for salary account holders can be lower than their quote rates, which can reduce the overall cost of loan and EMI. Lowest interest rate offered by Canara Bank is 13.00%. However, it is advisable to do complete market research and compare rates online before you apply for a loan.
• Loan tenure – This is the period in which you can repay your loan in Canara Bank. Longer loan tenure means lower personal loan EMI. Generally, Canara Bank offers a loan for a maximum tenure of 4 years.

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 Personal 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 Personal Loan of ₹ 2.50 Lakh for 5 years at an interest rate of 10.40%. EMI calculated for this loan amount is ₹ 5,361 and the total annual EMIs to be paid annually is ₹ 64,333. The EMI schedule of loan for 5 years is explained below in the table –

Amortization Schedule for a Personal Loan of ₹ 2.50 Lakh over the 5 years

Year	Interest paid during the year	Principal repaid during the year	Total amount paid during the year (Interest + Principal)	Outstanding Principal
2021	₹ 20,392	₹ 33,219	₹ 53,611	₹ 2,16,781
Mar	₹ 2,167	₹ 3,194	₹ 5,361	₹ 2,46,805
Apr	₹ 2,139	₹ 3,222	₹ 5,361	₹ 2,43,583
May	₹ 2,111	₹ 3,250	₹ 5,361	₹ 2,40,333
Jun	₹ 2,083	₹ 3,278	₹ 5,361	₹ 2,37,055
Jul	₹ 2,054	₹ 3,307	₹ 5,361	₹ 2,33,748
Aug	₹ 2,026	₹ 3,335	₹ 5,361	₹ 2,30,413
Sep	₹ 1,997	₹ 3,364	₹ 5,361	₹ 2,27,049
Oct	₹ 1,968	₹ 3,393	₹ 5,361	₹ 2,23,655
Nov	₹ 1,938	₹ 3,423	₹ 5,361	₹ 2,20,233
Dec	₹ 1,909	₹ 3,452	₹ 5,361	₹ 2,16,780
2022	₹ 20,495	₹ 43,839	₹ 64,333	₹ 1,72,942
Jan	₹ 1,879	₹ 3,482	₹ 5,361	₹ 2,13,298
Feb	₹ 1,849	₹ 3,513	₹ 5,361	₹ 2,09,785
Mar	₹ 1,818	₹ 3,543	₹ 5,361	₹ 2,06,242
Apr	₹ 1,787	₹ 3,574	₹ 5,361	₹ 2,02,669
May	₹ 1,756	₹ 3,605	₹ 5,361	₹ 1,99,064
Jun	₹ 1,725	₹ 3,636	₹ 5,361	₹ 1,95,428
Jul	₹ 1,694	₹ 3,667	₹ 5,361	₹ 1,91,761
Aug	₹ 1,662	₹ 3,699	₹ 5,361	₹ 1,88,062
Sep	₹ 1,630	₹ 3,731	₹ 5,361	₹ 1,84,330
Oct	₹ 1,598	₹ 3,764	₹ 5,361	₹ 1,80,567
Nov	₹ 1,565	₹ 3,796	₹ 5,361	₹ 1,76,771
Dec	₹ 1,532	₹ 3,829	₹ 5,361	₹ 1,72,942
2023	₹ 15,712	₹ 48,622	₹ 64,333	₹ 1,24,321
Jan	₹ 1,499	₹ 3,862	₹ 5,361	₹ 1,69,079
Feb	₹ 1,465	₹ 3,896	₹ 5,361	₹ 1,65,184
Mar	₹ 1,432	₹ 3,930	₹ 5,361	₹ 1,61,254
Apr	₹ 1,398	₹ 3,964	₹ 5,361	₹ 1,57,290
May	₹ 1,363	₹ 3,998	₹ 5,361	₹ 1,53,293
Jun	₹ 1,329	₹ 4,033	₹ 5,361	₹ 1,49,260
Jul	₹ 1,294	₹ 4,068	₹ 5,361	₹ 1,45,192
Aug	₹ 1,258	₹ 4,103	₹ 5,361	₹ 1,41,090
Sep	₹ 1,223	₹ 4,138	₹ 5,361	₹ 1,36,951
Oct	₹ 1,187	₹ 4,174	₹ 5,361	₹ 1,32,777
Nov	₹ 1,151	₹ 4,210	₹ 5,361	₹ 1,28,567
Dec	₹ 1,114	₹ 4,247	₹ 5,361	₹ 1,24,320
2024	₹ 10,407	₹ 53,926	₹ 64,333	₹ 70,394
Jan	₹ 1,077	₹ 4,284	₹ 5,361	₹ 1,20,036
Feb	₹ 1,040	₹ 4,321	₹ 5,361	₹ 1,15,716
Mar	₹ 1,003	₹ 4,358	₹ 5,361	₹ 1,11,357
Apr	₹ 965	₹ 4,396	₹ 5,361	₹ 1,06,961
May	₹ 927	₹ 4,434	₹ 5,361	₹ 1,02,527
Jun	₹ 889	₹ 4,473	₹ 5,361	₹ 98,055
Jul	₹ 850	₹ 4,511	₹ 5,361	₹ 93,543
Aug	₹ 811	₹ 4,550	₹ 5,361	₹ 88,993
Sep	₹ 771	₹ 4,590	₹ 5,361	₹ 84,403
Oct	₹ 731	₹ 4,630	₹ 5,361	₹ 79,774
Nov	₹ 691	₹ 4,670	₹ 5,361	₹ 75,104
Dec	₹ 651	₹ 4,710	₹ 5,361	₹ 70,394
2025	₹ 4,523	₹ 59,810	₹ 64,333	₹ 10,584
Jan	₹ 610	₹ 4,751	₹ 5,361	₹ 65,643
Feb	₹ 569	₹ 4,792	₹ 5,361	₹ 60,851
Mar	₹ 527	₹ 4,834	₹ 5,361	₹ 56,017
Apr	₹ 485	₹ 4,876	₹ 5,361	₹ 51,141
May	₹ 443	₹ 4,918	₹ 5,361	₹ 46,223
Jun	₹ 401	₹ 4,960	₹ 5,361	₹ 41,263
Jul	₹ 358	₹ 5,003	₹ 5,361	₹ 36,259
Aug	₹ 314	₹ 5,047	₹ 5,361	₹ 31,212
Sep	₹ 271	₹ 5,091	₹ 5,361	₹ 26,122
Oct	₹ 226	₹ 5,135	₹ 5,361	₹ 20,987
Nov	₹ 182	₹ 5,179	₹ 5,361	₹ 15,808
Dec	₹ 137	₹ 5,224	₹ 5,361	₹ 10,584
2026	₹ 138	₹ 10,584	₹ 10,722	-₹ 0
Jan	₹ 92	₹ 5,269	₹ 5,361	₹ 5,315
Feb	₹ 46	₹ 5,315	₹ 5,361	₹ 0

Each Personal 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 Personal Loan of ₹ 2.50 Lakh, taken at the lowest interest rate of 10.40%, EMI paid is ₹ 5,361 and an annual total of EMIs is ₹ 64,333, the interest component is ₹ 24,119 while the principal component is ₹ 40,214 in year 1 of loan disbursement. You repay only 16.09% of the total principal after paying 12 EMIs during the first year.

In year 5, the interest component of EMI is around 5.41%, while the principal component is around 94.59%. Upto 5 years, you have cumulatively repaid 100% of your total Personal Loan.

P*r* (1+r)^n/([(1+r)^n]-1)

Here is an illustration of how Canara Bank Personal Loan EMI is calculated:

In the above formula,

P = Loan amount. This can range from ₹ 1 Lakh to ₹ 3 Lakh

r = Rate of interest per month. Current rate is 13.00%

n = tenure in month. For Canara Bank, this can be 48 months

As a borrower, calculating right amount of EMI is a function of your loan requirement, your monthly income, repayment capacity as well as the amount of monthly instalment you can afford to pay out from your monthly income. As a guide, follow the below steps to estimate the EMI amount that is advisable for you.

• Decide the amount you need to borrow: It is important that before approaching a bank for loan, you need to estimate the amount of loan you need to borrow. Remember, a personal loan is an unsecured loan that can come at high interest rates and hence, it is advisable to limit your loan amount to the minimum required. Also, based on the EMI you can service, try to opt for the lowest tenure of loans as long tenure loans result in huge interest outgo.
• Review your current obligations: Before taking a loan, it is advisable to evaluate your current monthly expenses including any EMI obligations that you have on your current loan accounts. 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.
• Calculate your Canara Bank personal loan eligibility: Your loan eligibility is a function of an assessment of your repayment capacity based on your monthly income and other fixed obligations.
  
  • Multiplier based loan amount eligibility - Canara Bank calculates your loan amount eligibility by applying a multiplier to your net-take home salary. This is the simplest method for calculating loan eligibility used by banks. The formula used in the loan amount eligibility calculation is: Loan Eligibility = (Your Net Salary) x (multiplier of 9 to 18). The multiplier depends on the bank’s internal categorization of your employer company based on its reputation, stability, size, and growth in turnover.
  • FOIR based loan amount eligibility - Canara Bank will also estimate your Fixed Income to Obligations Ratio (FOIR) to ascertain the maximum EMI you can service based on your current income and other monthly expenses. The bank applies a certain ratio to your income to estimate your monthly expenses and then adds your other EMI obligations to calculate your fixed obligations. The proportion of fixed income to your calculated fixed obligations gives your FOIR. Canara Bank lends up to a maximum FOIR of 0.45. Based on the FOIR, the bank will also estimate the maximum amount of EMI you can service as a borrower. Canara Bank's assessment may be different from your assessment. Any differences in assessment may require you to readjust your loan amount requirement. You may also consider paying back other running short term loans to improve your eligibility.
  • Canara Bank will calculate your loan amount eligibility based on the above two methods and will sanction you a lower loan amount arrived at by the above two methods.

• Purpose of Loan: Canara Bank personal loan is taken to funding medical treatment in case of emergencies, paying additional debts, marriage expenses and other personal finance requirements.
• Key Features
  • Loan available for both salaried individuals and self-employed professionals.
  • Borrowers within the age group of 21 and 60 years.
  • Loan amount of minimum ₹ 1 Lakh to ₹ 3 Lakh.
  • Loan Tenure 1 to 4 years.
  • Interest rates in the range of 13.00% to 14.00%.
  • Lowest EMI of ₹ 2,683 per lakh.
• Processing Fees: 0.50% of loan amount. This is to be paid at the time of loan application
• Special schemes: Canara Bank offers customised personal loan interest rates and schemes for a special category of borrowers, including borrowers working in reputed companies, banks or government employees etc.

• Canara Bank personal loan calculator are online tools which give out EMI calculations using a combination of loan amount, interest rate and loan tenure.
• Canara Bank EMI 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.

In case you prepay your personal loan, the outstanding balance on your loan reduces. In this scenario, Canara Bank will allow you to reduce your loan tenure or reduce your EMI. The right decision is dependent on you monthly budget and personal preference. You should opt to reduce your EMI if you want to have a higher monthly spend budget or you should opt to lower your tenure if you want to save on your total interest outgo and want to close your loan quickly. You can calculate the change in your EMI by inputting the outstanding personal loan amount from Canara Bank, the interest rate and the remaining tenure in the EMI calculator.

✅Why should I calculate Canara Bank loan EMI before taking a loan?

It is advised to calculate personal loan EMI in advance before taking a personal loan. There are several benefits of calculating your Canara Bank personal loan EMI as discussed below -

• 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 spends accordingly
• Based on the EMI amount, you can opt for making prepayment of your personal loan in future when you have surplus amount

✅What is the lowest EMI per lakh offered by Canara Bank on personal loan?

Canara Bank offers personal loan at 13.00% interest rate for a maximum of 48 months, and hence lowest EMI on per lakh loan amount is ₹ 2,683. However, Canara Bank may offer a lower interest rate and EMI for their salary account holders or existing bank customers can vary.

✅How can I pre close Canara Bank personal loan?

You can preclose your Canara Bank personal loan by visiting the branch with the required set of documents. Submit the form of preclosure, pay the amount and take the acknowledgement of balance amount that you have paid.

✅What are the prepayment charges on Canara Bank ?

Canara Bank offers you an option of prepayment after 1 months at Nil prepayment charges.

✅Is there any processing charge on personal loan from Canara Bank?

Yes, Canara Bank charges a certain amount of processing fee to process your loan application. Currently, Canara Bank charges a processing fee of 0.50% on Personal Loan.

✅Will I get the personal loan from Canara Bank if i have a bad credit score?

No, for taking a loan from Canara Bank, an applicant must have a good credit score of 700 and above. Usually, most of the banks avoid giving loans if you have a low credit score.

✅How does a personal loan repayment happen?

The repayment of a personal loan happens in the form of an EMI (Equated Monthly Installment) through the customer's bank account. The customer is required to present a few post dated cheques and sign an ECS mandate in favour of the bank at the time of loan disbursal.

✅Can I have a co-applicant while applying for a Personal loan with Canara Bank ?

Yes, you can opt for a co-applicant to take a personal loan from Canara Bank that will increase your loan eligiblity as the income of the co-applicant is also taken into account.

✅Can we pay more than EMI in Canara Bank personal loan?

If you have funds, then you can pay more than the regular EMI on your loan. This will reduce your interest burden along with the outstanding principal. You can also pay one additional EMI every year to reduce loan tenure and in turn interest amount.

✅How can I pay my Canara Bank loan EMI?

You can pay the EMI on personal loan by using ECS facility or standing instruction. You can also visit the branch and submit the EMI cheque.