How it works
The EMI — equated monthly instalment — is the fixed payment that clears a loan of any kind exactly at the end of its term: EMI = P × i × (1+i)n ÷ ((1+i)n − 1), where P is the amount borrowed, i the monthly rate (annual rate ÷ 12 ÷ 100) and n the number of months.
- Enter the loan amount, the annual interest rate and the term in years.
- The calculator converts the rate to a monthly one and the term to months.
- It returns the instalment, the total interest and a month-by-month schedule.
Each instalment is the same size, but its make-up changes: early on most of it is interest, and by the end almost all of it is principal. That is why prepaying early saves far more than prepaying later — and why the schedule below the calculator is worth reading.
The same formula covers personal, car, home, education and gold loans — only the amount, rate and term change.
Examples
Worked examples:
- ₹3,00,000 at 11% for 3 years: EMI ₹9,822, total repaid ₹3,53,578, of which ₹53,578 is interest.
- Two years shorter: EMI rises to ₹26,514, but total interest falls to ₹18,174 — a saving of ₹35,404.
- One point cheaper (10.0%): EMI ₹9,680, saving ₹1,698 a year.
Lenders also check affordability: most cap all your EMIs together at 40–50% of take-home pay.
Related: Grade Calculator, ROI Calculator, Mortgage Calculator.
Loan Calculator: frequently asked questions
- What is the monthly payment formula for a loan?
- Payment = P × r(1+r)^n ÷ ((1+r)^n − 1), with r the monthly rate and n the number of payments.
- What is the total interest on a loan?
- Total interest = monthly payment × number of payments − loan amount.
- What is APR?
- The annual percentage rate includes the interest rate plus fees, so it reflects the true yearly cost of borrowing.