EMI Calculator
Calculate your Equated Monthly Installments
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Formula
EMI = P × r × (1+r)^n / ((1+r)^n - 1)Frequently Asked Questions
What is EMI?
EMI stands for Equated Monthly Installment. It is a fixed monthly payment made by a borrower to repay a loan over a specified tenure. Each EMI consists of both principal and interest components.
How is EMI calculated?
EMI is calculated using the formula: EMI = P × r × (1+r)^n / ((1+r)^n - 1), where P is the principal loan amount, r is the monthly interest rate, and n is the number of monthly installments.
What is the difference between EMI and simple interest?
EMI includes both principal repayment and interest in each installment, so the principal reduces over time. Simple interest is calculated only on the original principal amount throughout the loan tenure.
Can I prepay my EMI loan?
Yes, most banks in India allow prepayment of loans. Floating rate loans typically have no prepayment penalty, while fixed rate loans may have a penalty of 1-3% of the outstanding amount.
How does a lower EMI affect total interest?
A lower EMI (longer tenure) means you pay more total interest over the loan life. A higher EMI (shorter tenure) reduces total interest significantly. Use our calculator to compare different scenarios.