When you set up a business, it is to fulfil a goal, a vision or a dream. You may have the best strategy in place, groundbreaking ideas and great intent, but the truth is, without a sufficient flow of funds, all this is in vain. Even the best business ideas have witnessed tragic ends because of a lack of funds. Especially today, with cutthroat competition and constant evolution, one must always be on top of their game. Investment in machinery, technological advancement and human resources is vital for the business to maintain liquidity to pay.
Whether starting off or successfully established, a business needs a continuous influx of funds. There are multiple ways one can finance business expenses; however, the most reliable and secure way to finance organisational costs is by taking a Business Loan from a reputed lender. That is one of the easiest and fastest ways to cater to your growing enterprise’s changing financial needs.
The best thing about Business Loans is that they are collateral free.
Before applying for a Business Loan, one must check their eligibility and plan their finances well with the help of a Business Loan calculator to ease this process. It accurately indicates the loan amount, interest rate, and monthly instalments. When you use a Business Loan EMI calculator, you have clarity about fund outflow and projections and can manage repayments smartly.
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What is a Business Loan?
As discussed above, enterprises – MNCs, start-ups, MSMEs, legacy businesses, sole proprietorships, etc.- take a Business Loan to fund their business needs. It gives the business liquidity to make suitable investments and purchases to keep running and achieve its targets. A Business Loan can be used for expansion, to make a significant investment, for plant and machinery, to fund working capital expenses, to buy a new office space, etc.
Whatever the business plan, a Business Loan will provide the required funds to make the plan fall through.
The easiest way to repay this loan is through Equated monthly instalments. These fixed monthly instalments are smaller parts of the principal and interest amount combined. They ease the repayment pressure as the whole chunk of the loan is divided into smaller, easy-to-repay parts.
What is a Business Loan EMI calculator?
A Business Loan EMI calculator is an online tool offered by lenders that allows you to calculate the monthly instalment amount to be repaid during the loan tenure. These Business Loan calculators are available on the lender’s website or other websites online, giving you an estimated idea about the monthly outflows. You need to enter the loan amount, the tenure of the loan and the interest rate. The Business Loan EMI calculator uses this data and auto-populates your monthly EMI amounts.
Knowing the outflow of funds each month before applying for the loan is a prudent move as that helps you make a call on other things – you may even end up altering the loan amount, and the tenure of the EMIs is not favourable. It is advisable to rely on a Business Loan EMI calculator to budget and plan your finances.
Elements of a Business Loan EMI calculator considers
Loan amount: The amount of money you plan to borrow for your business is the main element that decides the EMI amount. The higher the loan amount, the higher the EMI, keeping the loan tenure constant.
Interest Rate: This is also an essential indicator of the monthly EMI amount paid. It is one of the reasons you must thoroughly research and compare the loan options various lenders offer. Don’t go by interest rate solely; check out associated charges and hidden terms and conditions.
Loan Tenor: The repayment tenure also plays a significant role in determining the EMI. A shorter term means higher EMI, while a higher term means a lower monthly instalment.
Advantages of Using a Business Loan EMI Calculator
A Business Loan calculator has numerous advantages, which is why business owners and decision-makers must use it before applying for a Business Loan.
Saves time and effort
A Business Loan EMI calculator is one of the fastest and easiest ways to calculate monthly instalments. It is an automated tool that does not require anything from your end except entering the variables. You do not have to be a technical expert or good at mathematical calculations to get an accurate answer.
Error-free
When you manually calculate monthly EMIs, not only is it a strenuous and lengthy process, but it is also prone to errors. We may make errors when calculating the EMIs on our own, but a Business Loan calculator will come up with error-free numbers in seconds.
Accuracy and financial projections
Computing the EMI amount on a calculator prevents miscalculation and allows you to play with the numbers to reach the desired repayment amount. You can work backwards, based on your budget and figure out how much loan you actually can afford to take. If you know you only can repay Rs. 1,25,000 per month, you can work around the loan tenor and loan amount to get that desired number.
Helps compare lenders
Another vital advantage of computing your monthly instalments using a Business Loan EMI calculator is the ease of comparing the EMI amounts of different lenders. It helps you choose the most favourable lender and make an informed decision before borrowing a Business Loan. Loan interest rates vary from lender to lender, and Business Loans are of a significant value; even a tiny % difference can significantly impact the EMI amount. With a Business Loan EMI calculator, you can choose your business’s most economically viable option.
Improved Financial Planning with more clarity
Better financial planning is a unique benefit of using a Business Loan EMI calculator. When you have a precise estimate of your monthly outflows, you will know what will be left over and how to allocate the remaining funds. Similarly, you may already have fixed expenses and may only be able to take on a loan of a certain amount, and you will be able to determine that using a calculator. A Business Loan EMI calculator will help you opt for a loan amount commensurate with your financial repayment capacity. Keeping your business cash flow in mind, you can opt for the ideal loan amount and repayment tenure.
Easily accessible 24*7
A Business Loan EMI calculator is available online and is accessible anywhere at any time. It ensures that you are not time bound and prevents you from making rash decisions. You can explore the Business Loan EMI calculator at ease and at any convenient time.
