How To Calculate Your Personal Loan EMI
An EMI is a fixed amount you pay regularly to repay your loan. It includes both principal and interest, with the interest portion being higher in the initial months and gradually decreasing over time.
Personal loans provide quick access to funds for various needs. Before applying, it is essential to assess your repayment capacity, as the EMI (Equated Monthly Instalment) plays a crucial role in financial planning. Let’s learn how to calculate EMI for your personal loan in easy steps in upcoming sections.
What Is a Personal Loan EMI Calculator
A personal loan EMI calculator is an online tool that helps you estimate your EMI based on the loan amount, interest rate, and tenure. It allows you to evaluate repayment commitments in advance, ensuring better financial planning and cash flow management.
How Does An EMI Work
An EMI is a fixed amount you pay regularly to repay your loan. It includes both principal and interest, with the interest portion being higher in the initial months and gradually decreasing over time. The EMI amount is determined based on the loan amount, interest rate, and tenure and usually remains fixed unless loan terms change.
Formula For Personal Loan EMI Calculation
The EMI for a personal loan is calculated using the formula:
EMI =P×r×(1+r)^n(1+r)^n-1
Where:
- P = Loan principal (amount borrowed)
- R = Monthly interest rate (Annual interest rate ÷ 12 ÷ 100)
- n = Loan tenure in months
Since EMIs are paid monthly, the tenure is considered in months.
Example Calculation
If you take a personal loan of Rs 5 Lakhs at an annual interest rate of 15 per cent for 2 years (24 months):
EMI =5,00,000 × (15/100/12) × (1+15/100/12)^24(1+15/100/12)^24-1
The approximate EMI will be Rs 24,243 per month.
How To Use An EMI Calculator
Struggling with EMI calculations can affect your cash flow. Follow these steps for calculating EMI for personal loan efficiently:
- Visit any bank or NBFC website and navigate to the EMI Calculator section
- Enter the loan amount, interest rate, and tenure using the slider or manual input
- The calculator will instantly display your EMI amount, total payable amount, and interest breakdown
- Adjust the parameters to compare different EMI options and choose the best fit for your finances
Personal Loan EMI Calculation Detailed Schedule
Let’s calculate the above example with the help of an online EMI calculator:
1. Enter the loan details based on the previous example—Rs 5 Lakhs at an annual interest rate of 15 per cent for 2 years (24 months).
2. Then according to the EMI calculator, the details of your loan are as follows:
- EMI: Rs 24,243
- Total Interest: Rs 81,840
- Total Payment (Principal + Interest): Rs 5,81,840
Here’s a detailed breakdown of the repayment schedule for more clarity:
| Year | Principal | Interest | Total Payment | Balance | Loan Paid To Date |
| (A) | (B) | (A + B) | |||
| 2025 | |||||
| Feb | ₹ 17,993 | ₹ 6,250 | ₹ 24,243 | ₹ 4,82,007 | 3.60% |
| Mar | ₹ 18,218 | ₹ 6,025 | ₹ 24,243 | ₹ 4,63,788 | 7.24% |
| Apr | ₹ 18,446 | ₹ 5,797 | ₹ 24,243 | ₹ 4,45,342 | 10.93% |
| May | ₹ 18,677 | ₹ 5,567 | ₹ 24,243 | ₹ 4,26,666 | 14.67% |
| Jun | ₹ 18,910 | ₹ 5,333 | ₹ 24,243 | ₹ 4,07,756 | 18.45% |
| Jul | ₹ 19,146 | ₹ 5,097 | ₹ 24,243 | ₹ 3,88,610 | 22.28% |
| Aug | ₹ 19,386 | ₹ 4,858 | ₹ 24,243 | ₹ 3,69,224 | 26.16% |
| Sep | ₹ 19,628 | ₹ 4,615 | ₹ 24,243 | ₹ 3,49,596 | 30.08% |
| Oct | ₹ 19,873 | ₹ 4,370 | ₹ 24,243 | ₹ 3,29,722 | 34.06% |
| Nov | ₹ 20,122 | ₹ 4,122 | ₹ 24,243 | ₹ 3,09,601 | 38.08% |
| Dec | ₹ 20,373 | ₹ 3,870 | ₹ 24,243 | ₹ 2,89,227 | 42.15% |
| 2026 | |||||
| Jan | ₹ 20,628 | ₹ 3,615 | ₹ 24,243 | ₹ 2,68,599 | 46.28% |
| Feb | ₹ 20,886 | ₹ 3,357 | ₹ 24,243 | ₹ 2,47,714 | 50.46% |
| Mar | ₹ 21,147 | ₹ 3,096 | ₹ 24,243 | ₹ 2,26,567 | 54.69% |
| Apr | ₹ 21,411 | ₹ 2,832 | ₹ 24,243 | ₹ 2,05,155 | 58.97% |
| May | ₹ 21,679 | ₹ 2,564 | ₹ 24,243 | ₹ 1,83,476 | 63.30% |
| Jun | ₹ 21,950 | ₹ 2,293 | ₹ 24,243 | ₹ 1,61,527 | 67.69% |
| Jul | ₹ 22,224 | ₹ 2,019 | ₹ 24,243 | ₹ 1,39,302 | 72.14% |
| Aug | ₹ 22,502 | ₹ 1,741 | ₹ 24,243 | ₹ 1,16,800 | 76.64% |
| Sep | ₹ 22,783 | ₹ 1,460 | ₹ 24,243 | ₹ 94,017 | 81.20% |
| Oct | ₹ 23,068 | ₹ 1,175 | ₹ 24,243 | ₹ 70,949 | 85.81% |
| Nov | ₹ 23,356 | ₹ 887 | ₹ 24,243 | ₹ 47,592 | 90.48% |
| Dec | ₹ 23,648 | ₹ 595 | ₹ 24,243 | ₹ 23,944 | 95.21% |
| 2027 | |||||
| Jan | ₹ 23,944 | ₹ 299 | ₹ 24,243 | ₹ 100.00 | 0% |
Disclaimer - The values are only for illustration purposes.
Why Use A Personal Loan EMI Calculator Instead Of Manual Calculation
Manually computing EMI using formulae or Excel can be confusing, time-consuming, and prone to errors. An online EMI calculator simplifies this process by instantly calculating your EMI, interest, and total loan amount. It provides quick, accurate results with easy-to-understand graphs and charts, helping you make informed financial decisions.
Using a Personal Loan EMI Calculator saves time, ensures accuracy, and helps you plan your finances effectively. Instead of relying on manual calculations, an EMI calculator provides instant results, allowing you to compare options and choose a repayment plan that suits your budget. It’s a simple yet essential tool for responsible borrowing and financial management.
Disclaimer: This article is a paid feature. ABP and/or ABP LIVE do not endorse/ subscribe to the views expressed herein. We shall not be in any manner be responsible and/or liable in any manner whatsoever to all that is stated in the said Article and/or also with regard to the views, opinions, announcements, declarations, affirmations, etc., stated/featured in the said Article. Accordingly, viewer discretion is strictly advised.
Top Headlines
