Business Loan EMI Calculator

EMI = [P × R × (1+R)^N] / [(1+R)^N - 1] where P is principal, R is monthly interest rate (annual rate / 12 / 100) and N is tenure in months. Calculator applies this formula for reducing-balance EMI, the standard for most secured business loans.

Flat-rate EMI computes interest on the full principal for the entire tenure, leading to higher effective rates (often 1.85-2× the displayed rate). Reducing-balance EMI charges interest on the outstanding principal — most legitimate lenders use this for business loans. Always check before signing.

Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) provides collateral-free loans up to ₹5 crore for MSMEs by guaranteeing up to 75-85% of the credit facility. Public-sector banks and several NBFCs offer CGTMSE-backed term loans to first-time entrepreneurs.

Yes — Pradhan Mantri MUDRA Yojana (PMMY) loans up to ₹10 lakh (Shishu up to ₹50,000, Kishore up to ₹5 lakh, Tarun up to ₹10 lakh) are collateral-free for non-corporate, non-farm small/micro enterprises. Interest rates are typically 8-12%.

Yes — interest on business loans is fully deductible under Section 37(1) of the Income Tax Act, computed on accrual basis per Ind AS. Principal repayment is not deductible separately but forms part of the cost. Calculator does not compute tax — only EMI / interest outflow.

Most term loans from banks allow part-prepayment with 0-2% charges after 6-12 EMIs. NBFCs typically levy 2-4% foreclosure charges on floating-rate loans. Prepayment reduces future interest significantly, as surfaced by the calculator when you enter part-payment.