About the Business Loan Calculator
A business loan funds inventory, receivables, equipment or expansion without diluting ownership, but because pricing depends heavily on the business itself, it pays to model the EMI before you commit to a sanction. This calculator works out your monthly EMI, total interest and total repayment for a term business loan, secured or unsecured.
Who should use this calculator
Proprietors, partnerships, LLPs and companies comparing a term loan against other working-capital options, and any business owner wanting to see how the EMI changes with tenure before applying.
Business loan interest rates in India
Business loan rates in India typically range from about 11% to 24% per year, depending on the business's vintage, turnover, banking conduct and whether the loan is secured or unsecured. Established businesses with strong financials and a clean banking record generally qualify for the lower end of that range; newer or unsecured borrowers sit higher.
Documents required for a business loan
- PAN of the business and its promoters
- Identity and address proof of the promoters
- ITR of the business for the last two to three years
- Audited financial statements
- Bank statements for the last six to twelve months
- Business registration proof and GST returns, where applicable
Tips to get your business loan approved faster
- Keep GST and ITR filings current and consistent with your bank statement turnover, mismatches are a common reason for delay.
- Maintain a clean banking record. Frequent bounced payments or an overdrawn account weigh heavily against approval.
- Compare the effective annualised cost, not just the headline rate, processing fees and other charges can change which offer is genuinely cheapest.
- Decide between a term loan and an overdraft based on whether your need is one-time or ongoing. The two are priced and structured differently.
Looking to compare business loan offers or scheme-linked credit? A Kaithi Finance loan expert can help on WhatsApp, free of charge.
Business loan interest rates in India (September 2026)
Unsecured business loan pricing tracks your business vintage, ITR-declared turnover and banking conduct far more than your personal credit score. A secured facility against property will always be several points cheaper than the unsecured rates below.
| Lender type | Typical rate (p.a.) | Typical max tenure | Best suited to |
|---|---|---|---|
| Public sector banks / MSME schemes | 9.50% – 14.00% | 5–7 years | Registered MSMEs with filed ITRs |
| Private banks | 12.00% – 18.00% | 5 years | 3+ years vintage, steady banking |
| NBFCs | 15.00% – 24.00% | 3–5 years | Newer businesses, faster disbursal |
| Invoice / merchant-cash lenders | 18.00% – 30.00% | 1–2 years | Short working-capital gaps only |
Indicative ranges as of September 2026, compiled from publicly advertised lender pricing. Rates are personalised to your credit score, income and loan-to-value, and change without notice. Always confirm the current rate, spread and reset frequency in your lender's Key Fact Statement before signing.
Business loan EMI per ₹1 lakh
Multiply the figure below by your loan amount in lakhs to get a quick EMI estimate, a ₹25 lakh loan is simply 25 × the per-lakh EMI. Use the calculator above for the exact figure including processing fees.
| Rate (p.a.) | 1 yr | 2 yr | 3 yr | 5 yr |
|---|---|---|---|---|
| 12% | ₹8,885 | ₹4,707 | ₹3,321 | ₹2,224 |
| 14% | ₹8,979 | ₹4,801 | ₹3,418 | ₹2,327 |
| 16% | ₹9,073 | ₹4,896 | ₹3,516 | ₹2,432 |
| 19% | ₹9,216 | ₹5,041 | ₹3,666 | ₹2,594 |
| 22% | ₹9,359 | ₹5,188 | ₹3,819 | ₹2,762 |
Before you apply, worth checking
- a loan against property, typically 4-8 percentage points cheaper than an unsecured business loan.
- the eligibility estimator, to sense-check the EMI against your monthly cash flow.
- what early repayment saves, worth modelling before you accept a lock-in clause.
Frequently asked questions
What is a good interest rate for a business loan in India?
Business loan rates in India typically range from about 11% to 24% per year, depending on the business's vintage, turnover, banking conduct and whether the loan is secured. Established businesses with strong financials usually qualify for the lower end.
Is a personal guarantee usually required for a business loan?
Yes, personal guarantees from promoters are commonly required, especially for unsecured business loans to proprietorships, partnerships and smaller companies. Always check this before signing.
Can Kaithi Finance help compare business loan and MSME scheme options?
Yes. Message us on WhatsApp with your business details and funding need and we will help you compare standard business loans against scheme-linked options that may offer better terms.
What is the EMI on a ₹20 lakh business loan?
At 16% per annum over 3 years, a ₹20,00,000 unsecured business loan has an EMI of about ₹70,300 and total interest near ₹5,30,900. A secured facility against property at 11% over the same tenure would cut the EMI to roughly ₹65,500.
What documents does a business loan need?
Typically: two to three years of ITRs with computation, audited financials, GST returns for the last 12 months, 6–12 months of current-account statements, KYC for all partners or directors, and proof of business continuity such as registration or a Udyam certificate.
Can a new business get a loan?
Most lenders want 2–3 years of vintage and filed ITRs for an unsecured loan. Newer businesses generally need either collateral, a government-backed MSME scheme such as CGTMSE, or a loan against the promoter's property instead.
Is a secured business loan worth the paperwork?
Usually yes if the amount is meaningful. The rate gap between unsecured (15–24%) and property-backed (9.5–13%) borrowing is wide enough that on ₹50 lakh over 5 years it can be worth several lakhs in interest, far more than the extra processing time costs you.
Do business loans have prepayment charges?
Commonly 2–5% of the outstanding principal, often with a 6–12 month lock-in. Floating-rate loans to individuals are exempt under RBI rules, but that exemption generally does not extend to loans to companies and firms. Check the sanction letter.