Allahabad Bank offers the facility of applying for personal loans and other loans online. When you apply online, you have the benefit of determining your provisional eligibility online, as well. Allahabad Bank has a user-friendly EMI calculator on its webpage. This EMI calculator enables customers to calculate their EMI in advance. The EMI calculator is one of the most accessible tools to use.
The customer has to submit the following information for the system to determine the EMI.
The EMI calculator displays the following information:
Consider the following example
Allahabad Bank offers term loan and overdraft facilities to its borrowers. Usually, the personal loan facilities are repayable over of period of 60 months. Some of the personal loans with collateral like the AB Mortgage Loan have an extended repayment tenure up to 10 years. The ideal mode of repaying term loans in the EMI method.
The EMI calculation is a complicated procedure. Hence, you have these EMI calculators on almost all the bank websites. The EMI comprises of two constituents, the interest repayment and the principal amount repayment part.
In the initial stages of the loan, especially the home loans, the interest component is exceptionally high. In the case of personal loans, the difference is not much pronounced because of the shorter tenures.
Calculating the EMI in the manual mode is a challenging task. MS Excel tables allow you to calculate the EMI, but not everyone is conversant with the same. The EMI calculator on the Allahabad Bank website is not only simple to use but also provides accurate results.
The advantages of using the EMI Calculator are as follows:
Allahabad Bank links its retail loan interest rates to an external benchmark rate, the repo rate or the MIBOR (Mumbai Inter-bank offered rate).
The home loans, auto loans, and the education loans connect to the repo rates, whereas the personal loans, consumer loans, and others link to the MIBOR.
MIBOR is an inter-bank rate that banks use to charge interest on short term loans to each other. FBIL announces this rate daily. It is an inter-bank call money rate.
Allahabad Bank links its personal loans to the 3-month MIBOR. As on date, the reference rate is 6.15%. Allahabad Bank adds a spread over the benchmark rate depending on the internal credit rating of the borrower.
|Loan Product||Customer rating||3M-MIBOR||Spread||Effective ROI|
|All Bank Saral||AB-1 and AB-2||6.15%||6.00%||12.15%|
|AB-3 and AB-4||6.15%||6.25%||12.40%|
|AB-5 and AB-6||6.15%||6.50%||12.65%|
|Personal loan to doctors and LIC employees||AB-1 and AB-2||6.15%||4.50%||10.65%|
|AB-3 and AB-4||6.15%||4.75%||10.90%|
|AB-5 and AB-6||6.15%||5.00%||11.15%|
|Overdraft in savings accounts||Not Applicable||6.15%||5.40%||11.55%|
Know in detail: Simple interest Formula Calculation.
It depends on the category of personal loan you avail. If you opt for a personal loan against your fixed deposit receipts, the rate of interest applicable to your personal loan does not change. Hence, your EMI will remain the same throughout. If you avail for the clean personal loan or the product that links to an external benchmark rate, the rate of interest can fluctuate. Therefore, EMI can vary, as well.
The calculation of the EMI depends on the following three factors.
The moratorium is usually not available on personal loans. However, housing loans come with varying moratorium periods. The borrowers can opt to pay the interest during the moratorium. At times, the banks offer to capitalise the interest portion and add it to the principal amount. Under such circumstances, the EMI will be higher than what it is when there is no capitalisation.
The EMI calculator accounts for these aspects by calculating the interest for the moratorium separately.
No, the rate of interest for each borrower will vary because of the internal credit rating. Each borrower has a specific internal credit score ranging from AB-1 to AB-6. The rate of interest depends on this score.
Yes, the method of calculating the EMI is universal. Hence, the EMI calculator that serves the purpose of calculating the personal loan EMI can also cater to the home loan, as well.
The EMI calculator offered by Allahabad bank does not perform the reverse calculation. However, some of the EMI calculators available on the internet do so.
Yes, you can do a manual reverse calculation on the Allahabad Bank EMI calculator. It can prove useful to determine your loan affordability.
This method involves using the trial and error calculation. The regular EMI calculator provides you with an estimate for a given loan amount, ROI, and tenure. If you can afford a higher EMI, you can proceed to increase the loan amount gradually on a trial and error basis for arriving at the affordable EMI.
Yes, Allahabad Bank personal loans connect to the 3M-MIBOR. As and when the reference rate changes, Allahabad Bank revises the effective interest rate on loan. Usually, banks increase the tenure of the loan to accommodate any increase in the interest rate. However, they do not do so for personal loans. Therefore, the EMI amount will change when you vary the rate of interest while keeping the tenure constant.