EMI Calculator

Monthly EMI is calculated using: EMI = P × r × (1+r)^n / ((1+r)^n − 1). The annual interest rate is divided by 12 to get the monthly rate, and the tenure in years is multiplied by 12 to get n. So a ₹10 lakh loan at 9% for 10 years gives r = 0.0075 and n = 120. Plug those in and the EMI works out to roughly ₹12,668. The formula assumes a reducing balance, which is what banks use for home, auto, and personal loans. Our calculator handles the math instantly.

For reducing balance loans, the formula is: EMI = P × r × (1+r)^n / ((1+r)^n − 1). Each month, interest is charged only on the outstanding principal, not the original loan amount. After every EMI, your principal drops a little, so the interest portion of the next EMI is slightly smaller, and the principal portion slightly larger. This is why early EMIs are interest-heavy. The total EMI stays the same throughout the tenure, but its composition shifts month by month. The amortisation schedule shows this split clearly.

Each EMI is split between interest and principal, but the proportion changes every month. Interest for a given month = outstanding principal × monthly interest rate. Principal portion = EMI − interest portion. Take a ₹20 lakh loan at 9% for 20 years — EMI is around ₹17,995. In the first month, interest is ₹15,000 and principal is just ₹2,995. By year 15, the split flips, with most of your EMI going to principal. This is exactly why prepayments early in the loan save so much more interest than prepayments later.

Even a 0.5% rate change moves the EMI noticeably. On a ₹50 lakh, 20-year loan, going from 8.5% to 9% pushes your EMI from about ₹43,391 to ₹44,986 — that's around ₹1,595 more a month, or roughly ₹3.83 lakh extra over 20 years. A full 1% increase costs you about ₹3,200 more monthly. This is why floating-rate borrowers feel every RBI repo rate move. When rates rise, you can either accept a higher EMI or extend the tenure. Always check both scenarios in the calculator before agreeing to a reset with your bank.

Yes, a longer tenure brings the EMI down — but it pushes your total interest paid up sharply. On a ₹15 lakh loan at 10%, the EMI for 5 years is ₹31,870 with ₹4.12 lakh total interest. Stretch to 10 years and the EMI drops to ₹19,822, but total interest jumps to ₹8.79 lakh. Use longer tenure only if the shorter EMI would genuinely strain your monthly cash flow. Otherwise, the cheaper EMI is an illusion. Take the shortest tenure you can manage and prepay whenever a bonus comes in.

To calculate home loan EMI manually, use: EMI = P × r × (1+r)^n / ((1+r)^n − 1). Convert the annual rate to monthly by dividing by 12 and by 100. Convert the tenure to months. Example: ₹40 lakh at 8.5% for 20 years. r = 0.007083, n = 240. (1+r)^n comes out to about 5.4276. So EMI = (40,00,000 × 0.007083 × 5.4276) ÷ (5.4276 − 1) = ₹34,713 approximately. Doing this on paper is good practice once. After that, the calculator saves time and removes errors.

Your EMI stays constant because the formula spreads interest evenly across the tenure. But what changes each month is the split between interest and principal. Early on, the outstanding balance is huge, so most of your EMI goes towards interest. As you keep paying, the balance shrinks, so the interest portion shrinks and the principal portion grows. The EMI itself is locked unless the bank resets the rate or tenure. This shifting mix is why an amortisation schedule looks the way it does. The calculator lets you see the month-wise breakdown.