What is EMI in a loan?

EMI (Equated Monthly Instalment) is the fixed monthly payment a borrower makes for a loan with a defined tenure and interest rate. Each EMI covers both interest on the outstanding balance and a slice of principal repayment. The amount stays constant; the interest-vs-principal split changes month by month.

How does loan tenure affect EMI?

Longer tenure means a smaller EMI but much more total interest paid over the life of the loan. A 20-year home loan EMI looks affordable, but you pay roughly double the principal in interest. Shorter tenure raises the monthly EMI but cuts total interest sharply.

Does prepayment reduce EMI?

Prepayment usually reduces tenure first (your EMI stays the same and the loan closes sooner). Most lenders let you ask for either tenure-reduction or EMI-reduction — tenure-reduction saves more interest. Floating-rate retail loans (home, personal) typically allow part-prepayment without penalty; fixed-rate and corporate loans may charge a fee.

Is the EMI calculator accurate?

The reducing-balance formula is exact. Actual bank EMIs may differ slightly because of processing fees, prepayment charges, GST on loan insurance, or lender-side rounding rules. Use this calculator to compare offers; treat the lender’s sanction letter as the source of truth.

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EMI calculator

Find your monthly EMI and the full interest cost of a loan, before you sign.

What is an EMI calculator?

An EMI (Equated Monthly Instalment) calculator computes the fixed monthly payment a borrower owes on a reducing-balance loan, given the principal, annual interest rate, and tenure. The same EMI is paid every month for the full tenure; the split between interest and principal shifts over time, with interest dominating the early years and principal the later years.

Formula used

EMI = P × i × (1+i)^n / ((1+i)^n − 1)

P = principal, i = monthly interest rate (annual % ÷ 12 ÷ 100), n = tenure in months. Total interest = EMI × n − P.

How to use this EMI calculator

1Enter the loan amount (principal) you intend to borrow in rupees.
2Enter the annual interest rate the lender has quoted as a percentage.
3Enter the tenure in years — longer tenures reduce EMI but multiply total interest.
4Read the monthly EMI, total payment, and total interest figures below the inputs.

Inputs

Loan amount (₹)Principal you intend to borrow.Annual interest rate (%)Reducing-balance rate the lender quoted you.Tenure (years)Longer tenure means lower EMI but much more interest overall.

Results

Monthly EMI

₹21,696

Total payment over tenure

₹52,07,040

Total interest

₹27,07,040

EMI shown uses the standard reducing-balance formula. Actual bank EMI may differ slightly because of processing fees, prepayment charges, GST on insurance, or rounding rules in the lender’s amortisation schedule.

What this loan actually costs

You borrow ₹25 L — you repay ₹52.07 L (2.08× the principal).

₹27.07 L of that is pure interest — 52% of every rupee you pay back goes to the lender, not to your house / car / dream. Prepayment cuts that line item faster than anything else.

The journey, month by month

Month 1: pay ₹21.7k — most of it is interest, a sliver chips at principal. Year 10: the split flips, principal finally outpaces interest. Month 240: the last EMI clears the loan. Same cheque each month — wildly different work behind the scenes.

Track this EMI in Extrack — so you never miss it →

Real EMI may differ slightly from the calculator because of processing fees, prepayment charges, insurance GST, or lender-side rounding.

Already paying an EMI?

Add the loan to Extrack and the EMI becomes a recurring entry — the home dashboard then shows you whether next month survives, every month, automatically.

Try Extrack free →

How is EMI calculated?

EMI = P × i × (1+i)^n / ((1+i)^n − 1), where P is the principal, i is the monthly interest rate (annual % ÷ 12 ÷ 100) and n is the number of months. The same EMI is paid each month; what changes month-over-month is the split between interest and principal.