EMI includes various components such as the principal amount and the accrued interest. Sometimes, when the payee already has enough amount to pay the EMI or some amount of it, he/she doesn’t have to wait until the date appears. The payee can pay until the full disbursal is done. Let’s explain it with a layman’s example:
Supposedly, Bindu’s salary gets credited on the 1st of every month, and her EMIs are dated every seventh of the month. Within a time span of 1st-6th, Bindu can pay the amount of her EMIs, and this amount will be known as Pre-EMI. The EMI payments start after your Pre-EMI tenure. The Pre-EMI (Estimated Monthly Instalments) loan does not contribute to the entire principal amount.
Now, a few of our readers might be wondering that how Pre-EMI is different from regular EMIs. EMI is the repayment of the outstanding principal loan amount along with interest accrued upon. The transactional payments of EMIs begin only after the pre-EMI tenure. On the contrary, pre-EMI enables the user to pay a comparatively lesser amount than the regular EMIs. This mode of transaction is easily accessible for the borrower when he/she doesn’t have enough cash flow. Let’s explain it with an example:
Mr. Sharma takes a business loan amounting to be ₹10,00,000/- for 24 months with a 12% reducing interest rate. He chooses the pre-EMI method and pays it until the EMI date arrives for his company, Cocab Content Solutions. After that, he can start with the EMI payments which will go up till for a tenure period of remaining months. The total interest payable is ₹1,29,764/- and the monthly instalments will be of ₹47,074/-.
In this blog, we will know how the pre-EMI calculator can affect factors for a loan. Read further to know more!
Can you opt for Pre-EMI loan? Know who can…
There are a lot of people out there who have cash flow issues, and there are times when we are unable to manage our finances properly. Monetary losses may come at any time. It doesn’t knock your door. For small business owners, ZipLoan has an accessible option of Pre-EMI where the needy ones do not have to wait until the whole amount impulses to the respective account. One can easily repay the small amount on a monthly basis. Think wisely before you head to the second stage, i.e., the second phase of EMI.
Avail your Pre-EMI option right now!
It’s crucial to know when you should apply for your particular loan. When the cash flow is less, and you can’t pay back the monthly instalment of your next gadget for the next month. It is advisable to pick Pre-EMIs on a tight budget. If you wish to have more and more returns, then get ready to research for more data, and you can also contact us anytime.
Now that we are aware of the Pre-EMI and the EMI concept, let’s throw some shade on EMI Calculators.
How an EMI Calculator Works?
Any kind of EMI can be calculated via an EMI calculator. ZipLoan has the facility available online and offline. These calculators give you the appropriate results of the final outcomes and come as handy. All they require is to fetch minute variables like:
- Loan Amount: The principal amount of the loan is highly dependent upon factors which are mostly relative to the amount and the applicant! It is inversely dependent upon each other, the more the amount of the loan, the more will be the EMIs that has to be paid every month.
- Tenure of the Loan: In layman’s language, it is referred to as the duration that is taken in the loan’s repayment. Although the tenure period differs from loan to loan, business loan/commercial loan/working capital loan, etc., and also the lender!
- Interest Rate: It is known as the rate on which you’re charged with the interest, where the principal amount is given by the lender. Hence, the EMIs vary according to the loan type, i.e., floating/hybrid/fixed. The interest rate on loan differs accordingly.
Factors Affecting Loan EMI
The EMI keeps on changing over time because of multiple factors occurring in accordance. When you wish to get a loan, you can always head to our website and look for EMI calculator and have an estimated amount by keeping different factors in mind. The tenure period keeps on altering throughout. Hence, the interest rate also varies.
Following are the factors which might affect the amount of your Estimated Monthly Instalment. Dive in!
- Change in ROI: A slight change might happen in the rate of interest on your loan period. The repayment on your loan transaction can be made at any time of the tenure phase. Although the change can, at times, be a negative/positive/nullify change. Initially, they apply a fixed rate of interest, and later on, it alters according to the type of interest of the loan. As in our country, RBI regulates the specific rates, and the payment of EMI can go upwards or downwards.
- Creditworthiness of the Business: A business’s creditworthiness is measured in terms of its credit score. A bank will only lend money to a business owner when there is no risk in the process. Money-lending a risky process and the only way to trust an individual is via checking their credit score. A good score might fetch your loan on a competitive ROI.
- Collateral: When we discuss business loans, there have been times when they are lent against collateral. When the business owner can give sufficient collateral to the lender against the loan, then the rate of interest on the loan will be less. This will help in reducing the risk of lending as well.
Thanks to ZipLoan, which offers its customers with flexible payment options to repay after that. There are business loan providers who provide flexible alternatives.
The payment made on EMIs is an essential aspect of your loan. Plan your way ahead on how you are going to manage your finances — research tonnes before you finalise on anything. Start saving early, you can always take some portion out from your monthly income/profits for this particular thing. With ZipLoan, taking a loan for your business is now pretty easy!