Compare your current business loan EMI with a takeover offer from another bank and see the monthly saving, break-even month and net saving after costs.
Use this when a bank offers to take over a loan you currently have with an NBFC or another bank, usually because your business now has two or three years of clean repayment, audited financials and a better credit report than when you first borrowed. Take the outstanding principal from the lender's foreclosure letter, not the original amount, and the remaining tenure in years.
Add every cost of switching: the new lender's processing fee with 18% GST, stamp duty on new loan and security documents, valuation and legal fees if property is mortgaged, the CGTMSE fee if the new loan is collateral-free, and any foreclosure charge your current lender can still levy (for fixed-rate loans, or for floating-rate loans sanctioned before 1 January 2026 under older terms).
How it works. Monthly saving = current EMI − new EMI on the same balance and tenure. Break-even = costs ÷ monthly saving, rounded up. Net saving = monthly saving × months left − costs.
Worked example (illustrative). ₹18 lakh outstanding with 4 years left: at 13.5% the EMI is about ₹48,737; at 10.75% it is about ₹46,304. You save about ₹2,433 a month, recover ₹30,000 of costs in 13 months and save about ₹86,800 net.
Limits. The tool ignores the time value of money, future rate resets and changes in working capital terms that often come bundled with a takeover. Ask your current lender to reprice first. See comparing business loan offers.
Calculations and Checklists
When MSME business loans can be prepaid without charges under RBI's 2026 directions, and how much a part-prepayment saves if you reduce EMI or tenure, with worked examples.
Rates, Schemes and 2026 Rules
How external benchmark (repo-linked) and MCLR pricing work for MSME business loans in India, how resets and spreads change your EMI, and when to ask for a switch.
Mistakes, Problems and Official Sources
What happens when an Indian MSME misses EMIs or over-draws a cash credit limit, from SMA-0 to NPA, how the RBI MSME revival framework and restructuring work, and your rights on recovery.
