How Does IndusInd Bank Personal Loan EMI Change in The Case of Balance Transfer?

Several banks and NBFCs provide the option of a personal loan to customers who are looking to fulfill their financial needs in an urgent way. IndusInd Bank Personal Loan is one of the popular options among customers due to its affordable interest rates. But do you know about the repayment method of a personal loan? Well, it is one of the important things that several people miss to notice. That’s why we are first talking about the concept of EMI? 

Well, let’s say you borrow some money from IndusInd Bank in the form of a personal loan, you can repay the amount via Equated Monthly Installments (EMI). This amount consists of a portion of both the principal and interest amounts. You must be thinking what must be the reason behind this concept of EMI? Well, lenders introduced this to make the overall repayment process smoother and simpler for individuals. The EMI amount is usually a fixed amount that you will need to clear off every month within a fixed time frame.

For example, you took an IndusInd Bank personal loan for 4 years (48 months), you will need to pay 48 EMIs to repay your personal loan. The concept of EMI is so popular that nowadays it is available not only in loans but also in credit and debit cards. We will talk about the behavior of EMI in the case of Balance Transfer and what is the formula of EMI in this article. So, let’s start. 

 

How EMI works in the case of IndusInd Bank Personal Loan?

Let’s see how EMI functions when you decide to opt for an IndusInd Bank personal loan. Suppose you want to opt for a personal loan of INR 2 lakh for a period of 4 years. The interest rate is 13% per annum. So, what will be the amount that you need to pay for the next 48 months? Well, the EMI amount would be INR 6,739. During this period, you will also need to pay an interest amount on the principal as INR 42,596. 

This calculation can be done via Personal Loan EMI Calculator. If you want to know which formulae this calculator works, have a look below. 

EMI = [P x I x (1+I)^N]/[(1+I)^N-1]

Where P = Principal Loan Amount

              I = Interest Rate per month [If the interest rate is 10% per annum, the monthly rate would be 10x(12x100)]

          N = the number of installments

Change in the EMI in the case of IndusInd Bank Personal Loan Balance Transfer?

Balance Transfer is one of the most popular facilities provided by banks to those customers who want to transfer their outstanding principal amount at lower rates to some other lender. By doing this, they can save a substantial amount on both EMI and Interest amount. 

Let’s see what will be the change in EMI when you opt for an IndusInd Personal Loan Balance Transfer facility. 

Suppose an individual has taken a 5-year personal loan from IndusInd Bank of INR 5 lakh at an interest rate of 15.99% per annum. 

For this loan amount, he must be paying an EMI of INR  12,156. 

Now, after two years (after paying 24 EMIs), he wants to opt for a Balance Transfer facility at a lower interest rate of 11.50% per annum. 

At the end of 2 years, the Outstanding Balance must be INR 3,45,822.

So, according to the new interest rate of 11.50% per annum, the new EMI would be INR 11,404.

After getting the new EMI amount of INR 11,404, you can see the change in the EMI amount of INR 752 (12,156 - 11,404). So, when you opt for a Balance Transfer facility on your IndusInd Bank personal loan, you can save this amount without breaking any sweat. All these calculations can be done via Personal Loan EMI Calculator.