Citibank is a foreign bank that started its operations in India in 1902 from Kolkata. At present, the headquarters of the bank is in Mumbai. It is a subsidiary of Citicorp, a multinational financial services corporation that is headquartered in Newyork City. Citibank offers various personal, corporate and retail products.
Citibank Personal Loans have gained popularity owing to the attractive interest rates and easy availability. The bank provides personal loans at an interest as low as 9.99% p.a. The online application process makes the obtention of the loan more accessible and faster. Also, there is the facility of pre-approved personal loans for existing customers of the bank who are eligible. If you qualify for the pre-approved loan, you can get the amount in your account within minutes of placing a request.
To ease the loan payment, Citibank offers flexible repayment options, i.e., payment of the loan in Equated Monthly Instalments. The bank provides Citibank Personal Loan EMI Calculator to know the EMI for the loan amount to suit your pocket.
Knowing the monthly outgo towards the proposed loan before applying for the loan will help you manage your monthly budget accordingly. You should estimate the disposable income even before using the Calculator to know the threshold for EMI of the proposed loan. To arrive at the surplus available, you should consolidate all your existing obligations and liabilities along with the buffer amount that has to be kept aside for likely emergencies during the repayment period. To evaluate the EMI, you can use the Citibank Personal Loan EMI Calculator in the manner shown below.
Citibank applies the reducing balance method for the calculation of Personal Loan Interest and =the mathematical formula for the calculation is EMI = [P x R x (1+R)N] / [(1+R)(N-1)]. Here P=Principal R=Interest and N=Tenure in months. Along with the EMI, the interest payable for the entire period will also be calculated. The amortization schedule will give an idea of the interest outgo month wise for the entire period. You can observe that the interest keeps decreasing as the outstanding balance decreases with every apportionment towards the principal.
Know in detail: Simple Interest Formula Calculation
To ease the repayment of the personal loan Citibank provides a flexible repayment plan in the form of EMI for an extended period of up to 60 months. Further to assess your eligibility and manage your EMI within the available budget, the bank provides Personal Loan EMI Calculator. The EMI Calculator is a technical tool that is simple to use and needs only three variants for the calculation, i.e., the loan amount, tenure and the rate of interest. The benefits of the EMI calculator are given below:
If you are availing of a loan for the first time and do not understand the nuances of the loan, you should definitely understand the implication of knowing the EMI before applying for the loan. Here is an example for you.
If you have a monthly gross income of Rs. 25000/- and the EMI is Rs. 12000/- you will be left with Rs. 13000/- for your expenses that include food, rent, mandatory bills etc. You should necessarily work out the expenses that are required and then borrow to the extent of the funds available after meeting all the required expenses. Otherwise, you will land up in financial stress. To arrive at the EMI that fits the benchmark, i.e., the surplus funds available, you should use the Citibank Personal Loan EMI Calculator.
If you already have other loans and credit card dues, you should arrive at the disposable income by consolidating the mandatory expenses and the existing liabilities and then use the Citibank Personal Loan EMI Calculator to arrive at the EMI that fits into the funds available.
Citibank Personal Loan is the best solution for emergency funds requirements. The versatility of the purpose of the loan makes it even more convenient as you need not produce proofs like bills and receipts for the end use of the loan. The attractive rate of interest and the flexible repayment options help you to choose an EMI that fits your budget. That does not mean you should get impulsive and borrow for purposes that are not a priority.
Choosing an EMI that suits your budget is essential to keep up the prompt repayment of the loan till the end of the tenure. EMI missouts can have heavy repercussions that may negate the chances of future loans like home loans or any other loans when in need. So, before applying for the loan, a review of the monthly budget and cash flows for now and the near future should be done to ensure prompt repayment.
After arriving at the surplus funds available to service the EMI, you can use the Citibank Personal Loan EMI Calculator to arrive at the EMI that suits your budget. Try various combinations of loan amount and tenure till you arrive at the EMI that fits your budget.
The three main factors that influence the EMI of Citibank Personal Loan are:
There are various other charges like processing charges, prepayment charges, delayed payment charges etc., that are associated with the personal loan. The EMI calculator will give you an idea of the total interest payable for the chosen tenure. But you cannot derive the cost of the loan with interest charged alone. The charges that can add up to the cost of the loan are given below.
Processing charges: Banks/NBFCs charge processing charges ranging from 0.50% to 2% of the loan amount at the time of applying for the loan. This will also add up to the cost of the loan. So while comparing the rate of interest, you should also compare the processing charges of different lenders to make a well-informed decision.
Prepayment charges: If you have decided to opt for a higher tenure initially with the intention of making prepayments during the repayment period to reduce the tenure and the cost of the loan, then you should definitely compare the prepayment charges levied by different lenders. The charges could range from 2% to 4% of the prepaid amount. You should then compare the returns on the amount that you intend to repay if invested in any other investment plan versus the amount saved on the loan interest before choosing the loan provider.
These are the charges about which the EMI calculators will not tell you. You should get the information either by visiting the bank branch or by calling the customer care helpline of the bank.
Yes. Citibank provides auto-repayment options through various methods. You can choose to request Standing Instructions, ECS or NACH facility for auto-repayment.
Yes. You can make prepayments to Citibank Personal Loans after making payments of a minimum of 12 EMIs. Prepayment charges at 5% of the amount prepaid will be collected.
Prepayments made apart from the regular EMIs will bring down the principal balance and will reduce the interest cost. If you intend to reduce the cost of the loan, you can keep the EMI constant and clear the loan before maturity. But if you intend to lower your EMI burden, you can opt for rescheduling of the EMI.
You should calculate the EMI before availing of Citibank Personal Loan for the following reasons.
Yes. Processing charges will be collected at 3% of the loan amount after the approval of the loan.