This article describes the development of an error compensation algorithm for a measurement current transformer (CT). The flux-magnetising current loops are derived in the proposed algorithm to minimise the number of required loops for computation. At every sampling interval, the exciting current is obtained from these loops and then it is added to the measured secondary current to gain the corrected primary current. The performance is tested using MATLAB program and later, the same code is executed in LabVIEW environment. Performance analysis indicates that the proposed algorithm improved the accuracy of the measurement CT notably even with minimum loops. The experimental test results demonstrate that the compensator is capable to correct the accuracy of the measurement CT in remarkable manner.