How it works
The EMI — equated monthly instalment — is the fixed payment that clears any loan 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.
Personal loans usually run 1–5 years at 10–16%; the shorter the term, the less interest you pay in total.
Examples
Worked examples:
- ₹5,00,000 at 10.5% for 5 years: EMI ₹10,747, total repaid ₹6,44,817, of which ₹1,44,817 is interest.
- Two years shorter: EMI rises to ₹16,251, but total interest falls to ₹85,044 — a saving of ₹59,773.
- One point cheaper (9.5%): EMI ₹10,501, saving ₹2,952 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 EMI Calculator: frequently asked questions
- How is EMI calculated?
- EMI = P × r(1+r)^n ÷ ((1+r)^n − 1), where r = annual rate ÷ 12 ÷ 100 and n = tenure in months.
- How can I reduce my EMI?
- Choose a longer tenure, negotiate a lower rate, or make a larger down payment. A longer tenure lowers the EMI but increases total interest.
- Does prepayment help?
- Yes. Part-prepaying reduces the outstanding principal, which cuts total interest; you can lower either the EMI or the remaining tenure.