Loan EMI Calculator
Enter the amount you want to borrow, the yearly interest rate and the loan term. You get the monthly instalment (EMI), the total interest you will pay and the full repayment amount.
Enter your numbers to see the result.
The EMI formula
EMI stands for equated monthly instalment. The calculator uses the standard reducing balance formula that banks use for personal, car and home loans:
EMI = P × i × (1 + i)n ÷ ((1 + i)n − 1)
Here P is the loan amount, i is the monthly interest rate (annual rate divided by 12 and by 100), and n is the number of monthly payments. When the rate is zero, the EMI is simply the loan amount divided by n.
A worked example
Borrow 500,000 at 10% a year for 5 years. The monthly rate is 0.8333% and there are 60 payments. The EMI comes to roughly 10,624. Over 60 months you repay about 637,400, so the interest cost is around 137,400, or close to 27% of the amount borrowed. Early on, most of each payment is interest. Near the end, most of it is principal.
Ways to lower what you pay
Term length matters more than most people expect. Stretching the same loan from 5 years to 7 lowers the EMI but raises total interest noticeably, so try several terms in the calculator before you decide. Paying extra toward principal early in the loan saves the most interest. Also ask whether your lender quotes a flat rate or a reducing balance rate. A flat rate of 8% can cost far more than a reducing rate of 8%, and this calculator assumes reducing balance.
What this estimate leaves out
Processing fees, insurance, late charges and variable rate changes are not included. Treat the result as a planning figure and confirm the final numbers with your lender. For property loans, the mortgage calculator adds tax and insurance to the monthly cost.
Frequently asked questions
What does EMI mean?
EMI means equated monthly instalment. It is the fixed amount you pay each month to repay a loan, covering both interest and part of the principal.
Does a longer loan term save money?
It lowers the monthly payment but raises the total interest you pay, because the balance stays outstanding for longer.
Is this calculator for flat or reducing balance interest?
It uses reducing balance, where interest is charged only on the remaining principal. If your lender quotes a flat rate, the real cost is higher than the same percentage on a reducing balance.
Can I use it for car loans and personal loans?
Yes. Any fixed-rate loan with equal monthly payments follows the same formula, including personal, car, education and home loans.