1. What is the Personal Loan Payment Formula?

The personal loan payment formula calculates the fixed monthly payment required to repay a loan over a specified term, including interest. This is particularly useful for SBI Bank customers with savings accounts who are considering personal loans.

2. How Does the Calculator Work?

The calculator uses the PMT formula:

Where:

• \( P \) — Principal loan amount (INR)
• \( r \) — Monthly interest rate (annual rate divided by 12)
• \( n \) — Number of monthly payments (loan term in years × 12)
• \( PMT \) — Monthly payment amount (INR)

Explanation: The formula accounts for compound interest over the loan term, calculating a fixed payment that covers both principal and interest each month.

3. Importance of Loan Calculation

Details: Understanding your monthly payment helps with budgeting and ensures the loan is affordable. It also helps compare different loan offers from SBI Bank.

4. Using the Calculator

Tips: Enter the principal amount in INR, annual interest rate (without % sign), and loan term in years. For SBI Bank personal loans linked to savings accounts, check current interest rates.

5. Frequently Asked Questions (FAQ)

Q1: What interest rates does SBI offer on personal loans?
A: SBI personal loan interest rates typically range from 9.60% to 15.15% p.a., depending on customer profile and savings account relationship.

Q2: Are there benefits for existing SBI savings account holders?
A: Yes, SBI often offers preferential rates and faster processing for existing savings account customers.

Q3: What's the maximum loan amount available?
A: SBI offers personal loans up to ₹20 lakhs, depending on income and repayment capacity.

Q4: How does the loan term affect payments?
A: Longer terms reduce monthly payments but increase total interest paid. Shorter terms have higher payments but lower total cost.

Q5: Are there prepayment charges?
A: SBI currently doesn't charge for prepayment of personal loans after 12 EMIs for fixed rate loans.