EMI Calculator

An EMI, or equated monthly instalment, is the fixed amount you pay a lender every month until a loan is cleared. Each instalment covers two things at once: the interest that accrued on the outstanding balance that month, and a repayment of the principal itself. The instalment stays the same, but the split inside it does not.

That shifting split is the part most borrowers never see. In the first year of a twenty-year home loan, the large majority of every payment is interest and barely any of it reduces what you owe. By the final years, almost all of it is principal. This calculator shows the EMI, the total interest, and the year-by-year breakdown behind both.

The formula is EMI = P x r x (1 + r)^n / ((1 + r)^n - 1), where P is the principal, r is the monthly interest rate — the annual rate divided by 12 and then by 100 — and n is the tenure in months.

The amortisation table, though, is not derived from a formula. It is simulated one month at a time: interest is charged on the balance, the rest of the instalment reduces the principal, and the new balance carries into the next month. Lenders build their schedules the same way, which is why the figures here line up with a real statement instead of drifting apart by the end of the term.

No — it makes it more expensive, and often dramatically so. A longer tenure lowers the monthly instalment, which is what most people are optimising for, but it also means interest accrues over more months on a balance that falls more slowly.

The honest comparison is EMI against total interest, side by side. A loan you can comfortably service over fifteen years will usually cost far less than the same loan stretched to twenty-five, even though the twenty-five year version feels easier every month.

Because interest is charged on the outstanding balance, every rupee of principal you clear early stops accruing interest for the entire remaining term. A prepayment in year two of a twenty-year loan avoids eighteen years of compounding; the same amount in year eighteen avoids two.

The extra-payment panel makes the size of that effect concrete. A modest monthly addition — often a few percent of the EMI — routinely takes years off the term, which is a much larger effect than most borrowers expect before they see the number.

This calculator assumes the rate you enter holds for the whole tenure, which is exactly true for a fixed-rate loan and an approximation for a floating one. On a floating loan a rate change usually keeps the EMI the same and adjusts the tenure instead, or the reverse, depending on the lender.

To see the range you are exposed to, run the calculation twice: once at your current rate and once one or two percentage points higher. The gap between the two totals is the interest-rate risk you are carrying.