Credit Card EMI Calculator

Credit Card EMI Calculator

Credit cards offer instant credit facilities to users to utilize any amount within the approved limit. Cardholders can use the credit card and repay the amount within a specified time. If the credit card users fail to pay the outstanding amount within the due date, the card issuer may levy a penalty or late fee. The total credit card outstanding amount can also be converted into Equated Monthly Installments (EMIs) for clearing the dues without additional fees. If you are planning to pay your credit card outstanding through EMIs, a Credit Card EMI Calculator will be helpful for a hassle-free repayment.

What is a Credit Card EMI Calculator?

A Credit Card EMI Calculator is an online tool that helps borrowers find out how much EMI they need to pay each month to repay their credit card debt. The online Credit Card EMI Calculator helps cardholders instantly check the monthly amount they have to pay after converting the total amount into EMIs.

How to Use the Credit Card EMI Calculator

Follow these steps to use the Credit Card EMI Calculator:

1. Open the webpage of any Credit Card EMI Calculator.
2. Enter the total credit card outstanding or the amount you want to convert to EMI.
3. Enter the interest rate charged by the credit card issuer.
4. Choose the repayment duration; it may range from 3 months to 24 months.

Factors Affecting Credit Card EMI

The following factors affect your credit card EMI:

• The amount you want to convert to monthly instalments or the total due.
• The interest rate charged by the credit card issuer.
• The repayment duration or EMI tenure.
• The credit history of the borrower.

Benefits of Using a Credit Card EMI Calculator

The Credit Card EMI Calculator offers several benefits:

• You do not need to do manual calculations to find out the monthly amount on your credit card dues.
• The calculator helps compute the exact amount based on the credit card dues, duration of payment, and interest rate. You can choose different tenures to finalize the EMI as per your convenience.
• The calculator also helps you check the interest amount you have to pay on the credit card dues when converting to EMIs. This allows you to avoid credit card defaults in the future.

Credit Card Interest Rates and Tenure

The interest rate and repayment duration are key factors that can increase or decrease the total amount you will pay towards the credit card outstanding. A higher interest rate increases both the monthly EMI and the total repayment amount. Conversely, a lower interest rate will reduce the total amount you need to pay. If you choose a longer tenure for a credit card transaction amount or the total outstanding balance, the EMIs may come down, but the interest portion will be higher.

Understanding EMI and Its Components

The Credit Card EMI Calculator uses a simple formula with three major components:

E = [P × R × (1 + R)^n] ÷ [(1 + R)^n - 1]

Where:

• E - This is the EMI amount.
• P – Total transaction amount or outstanding credit card balance converted into EMIs.
• R – Interest rate charged by the credit card issuer.
• N – Duration for which you will pay the EMIs.

Common Mistakes to Avoid While Using Credit Card EMI Calculators

To avoid common mistakes while calculating credit card EMI, keep the following in mind:

• Enter the exact credit card amount you want to convert into EMIs, the interest rate, and repayment duration to avoid incorrect EMI computation.
• Don’t miss trying different tenures and credit card balance amounts to find an EMI that won’t be a financial burden based on your monthly budget.
• Don’t ignore additional charges or fees levied by the card issuer on EMI conversion of credit card dues.
• Check the prepayment or foreclosure conditions for credit card EMIs.

Conclusion

Using a Credit Card EMI Calculator allows you to make quick decisions and plan your finances better. The calculator not only tells you how much money you need to pay each month, but it also helps you opt for a convenient EMI amount by converting a large outstanding balance. It’s advisable to use a Credit Card EMI calculator before finalizing whether converting your credit card repayments into EMIs will be financially prudent or not.