How personal loan EMI is calculated
A personal loan EMI depends on the borrowed amount, annual interest rate and repayment tenure. Each payment covers interest and principal, with the interest portion usually declining as the balance reduces.
The formula is EMI = P × r × (1+r)n / ((1+r)n − 1), where P is principal, r is the monthly interest rate and n is the number of monthly instalments.
Personal loan example
Enter your expected loan amount, rate and tenure above to estimate the monthly instalment. Actual rates can vary substantially by lender, credit history and eligibility.
Ways to manage personal loan costs
- Borrow only what you need and can repay comfortably.
- Compare the annual rate, processing fee and total repayment amount.
- Choose a tenure that keeps the EMI affordable without unnecessary interest.
- Check the agreement for part-payment rules and charges before prepaying.
Frequently asked questions
Does the calculator include processing fees?
No. It estimates principal and interest. Add lender fees separately when comparing offers.
What does extra prepayment do here?
Extra payments reduce the outstanding principal. The regular EMI stays unchanged, so the loan may finish sooner and accrue less interest.
Will my actual EMI match exactly?
This is an estimate using a fixed interest rate and monthly reducing balance. Lender calculations and charges may differ.