Are you planning to make a big-ticket purchase using your credit card but worried about managing your finances? You can manage your cash flows by either choosing EMI payment option directly on the merchant website/app OR converting your credit card payments into manageable monthly installments (EMIs) later using the bank website/app. Credit Card EMI Calculator provides accurate estimates of your EMIs, Annual Percentage Rate (APR), breakup of all payments and a detailed amortization schedule, ensuring you stay in control of your finances.
By entering the transaction amount, interest rate, tenure, and processing fees, you can quickly determine your EMI, understand the total cost of the credit card loan, and view the complete amortization schedule, including applicable GST (Goods and Services Tax).
Key Inputs for the Calculator
- Transaction Amount: The total amount you wish to convert into EMIs.
- Interest Rate: The annual ROI charged by the credit card issuer for EMI conversions. Note that interest rate does not affect the absolute outgo in a big way for a short-term loan. For instance, a loan of Rs 50,000 for 6 months at 15% p.a. interest rate will have an EMI of 8,701. Had the interest rate been 20% p.a., the EMI would have been Rs 8,826 per month. A difference of Rs 125 per month. Over 6 months, this translates to a difference of Rs 750 over 6 months.
- Tenure: The duration over which the EMIs will be paid, usually ranging from 3 to 24 months.
- Processing Fees: A one-time charge applied by the credit card issuer for processing the EMI conversion. You will likely be charged a processing fee of 1-3% of the loan amount and is subject to GST.
Outputs of the EMI Calculator
- Monthly EMI: The fixed amount you will pay every month, consisting of both principal and interest components.
- APR (Annual Percentage Rate): A comprehensive measure of the total cost of borrowing, including interest and processing fees. The calculated APR excludes GST applied on processing fees and interest. For short duration loans, the processing fee impacts the effective cost of loans in a big way.
- Breakup of All Payments: A pie chart showing all the components of the total payment over the course of loan tenure.
- Amortization Schedule: A detailed breakdown of each EMI, showing the monthly principal and interest components, GST on interest, total monthly payment, remaining balance and loan paid to date.
FAQs
- What is GST on processing fees and interest component of EMI? Currently, GST is charged at 18% on the processing fees and interest component of EMI.
- Can I prepay my credit card loan? Most credit card issuers allow prepayment, but a foreclosure fee may apply. Check with your provider for terms.
- Is the interest rate fixed for the entire tenure? Yes, the interest rate for EMI conversions is typically fixed for the entire tenure.