Business loan planning
Business Loan EMI Calculator.
Estimate your monthly EMI for a business loan, working capital facility, or MSME financing, and see the full repayment schedule before you apply.
- Principal amount
- ₹15,00,000
- Total interest
- ₹5,02,020
- Total amount
- ₹20,02,020
| Year | Principal | Interest | Balance |
|---|---|---|---|
| 1 | ₹2,32,941 | ₹1,67,463 | ₹12,67,060 |
| 2 | ₹2,62,481 | ₹1,37,923 | ₹10,04,578 |
| 3 | ₹2,95,772 | ₹1,04,632 | ₹7,08,807 |
| 4 | ₹3,33,283 | ₹67,121 | ₹3,75,524 |
| 5 | ₹3,75,524 | ₹24,853 | ₹0 |
Secured vs. unsecured business loans
Unsecured business loans (no collateral) are faster to get but carry higher rates, typically 12-20%, since the lender has nothing to recover against if you default. Secured loans — backed by property, equipment, or receivables — cost less, often 8.5-12%, and support larger amounts and longer tenures.
Frequently asked questions
How is business loan EMI calculated?
Business loan EMI uses the standard reducing-balance formula: EMI = P × r × (1+r)^n / ((1+r)^n − 1). Most unsecured business loans run 1-5 years, while loans backed by property or other collateral can extend up to 10 years, generally at a lower rate.
What's the typical interest rate range for business loans in India?
Business loan rates typically range from 8.5% to 20% p.a. depending on whether the loan is secured or unsecured, your business vintage, turnover, credit score, and the lender. Government-backed schemes like Mudra and CGTMSE-covered loans often carry lower, subsidized rates for eligible MSMEs.
Is collateral required for a business loan?
Not always — many banks and NBFCs offer unsecured business loans up to ₹50 lakh based on business financials and credit history alone, though at a higher rate than secured loans. Larger amounts, or loans from more conservative lenders, typically require property, equipment, or receivables as collateral.
Can I prepay a business loan without penalty?
Unlike individual home loans, RBI's ban on prepayment penalties doesn't automatically extend to business loans — many lenders charge a foreclosure fee of 2-5% on the outstanding amount. Always check your specific loan agreement before assuming free prepayment.