Credit Card EMI - How to Convert & Calculate EMI (2024)

FAQs

Credit Card EMI - How to Convert & Calculate EMI? ›

How to calculate the EMI on a Credit Card using the formula? Calculate your EMI with this formula: E=[P×R×(1+R) n] ÷ [(1+R) n-1] where E=monthly EMI, P=principal amount, R=interest rate, and n=tenure in months.

For example, If a person avails a loan of ₹10,00,000 at an annual interest rate of 7.2% for a tenure of 120 months (10 years), then his EMI will be calculated as under: EMI= ₹10,00,000 * 0.006 * (1 + 0.006)120 / ((1 + 0.006)120 - 1) = ₹11,714. Calculating the EMI manually using the formula can be tedious.

An EMI option comes with interest and may be higher than your expectations. Therefore, choose this option only when you are comfortable paying a higher amount. A credit card offers you access to money and the freedom to carry it wherever you go. It increases your purchasing power, and you can buy things with ease.

To calculate EMI with a reducing interest rate, use the formula: EMI = [P x Ix (1+I) ^T]/ [((1+I) ^T)-1)] where P is the principal, I is the monthly interest rate, and T is the tenure in months.

How to calculate Credit Card instalments? Calculate instalments with this formula: Instalment amount = (principal amount/number of months) + (principal amount×monthly interest rate). This formula helps you determine fixed monthly payments for converted Credit Card purchases.

The EMI amount is calculated by adding the total principal of the loan and the total interest on the principal together, then dividing the sum by the number of EMI payments, which is the number of months during the loan term.

Formula to calculate EMIs using MS Excel

Calculating EMI is easy with the following formula using MS Excel: EMI = (P X R/12) X [(1+R/12) ^N] / [(1+R/12) ^N-1]. Here, P is the original loan amount.

Here are 3 conversion rate formulas to use:

Conversion Rate = Total number of conversions / Total number of sessions * 100. Conversion Rate = Total number of conversions / Total number of unique visitors * 100. Conversion Rate = Total number of conversions / Total number of leads * 100.

1.The interest charges are very high

In the case of standard EMI, the interest charges can get really high if you take an EMI for a long duration or if the issuing bank charges high interest rates. In such cases, it may not be a wise decision to opt for a credit card EMI.

What happens if I pay all my credit card EMI at once? ›

Are there any fees or penalties for paying all EMIs at once? Some credit card issuers may charge a foreclosure fee or penalty for paying off all EMIs at once. It's important to review the terms and conditions of your EMI plan to understand any potential costs associated with early repayment.

EMIs on credit cards can generally be cancelled, but it depends on the bank's policies. You may need to pay the outstanding principal amount along with applicable charges or interest.

An Equated Monthly Instalment represents a part of your principal amount and interest payable.

The mathematical formula for calculating EMIs is: EMI = [P x R x (1+R)^N]/[(1+R)^N-1], where P stands for the loan amount or principal, R is the interest rate per month [if the interest rate per annum is 11%, then the rate of interest will be 11/(12 x 100)], and N is the number of monthly instalments.

In addition, credit card EMIs can be a valuable tool to raise your credit score and ensure financial security, provided you make timely payments. EMIs are very easy with OneCard. To convert your purchase to an EMI, simply, select the transaction you wish to convert into EMI, and choose the repayment duration.

Converting your credit card debt into a personal loan can be a strategic move to manage and eventually eliminate your debt. This process typically involves obtaining a personal loan to pay off your credit card balances, leaving you with a single loan payment at a lower interest rate.

No, your credit score is not negatively impacted if you choose to convert your outstanding dues into an EMI option, where possible. It only helps to ensure that your credit card dues are paid off on time every month and in a more manageable way. This helps to improve or maintain your credit score in the long run.

If you withdraw cash through your Credit Card, you can pay it back via an EMI facility readily available on your card. The cash advance limit is the amount you can withdraw using your Credit Card. It is calculated as a percentage of the total available credit limit.