Loans are an agreement of financial nature where one party agrees to lend a certain amount of money to a second party or the borrower. The lender gives the amount with hoes that the borrower will repay the amount with interest. The borrower can pay back the loan amount over a period of time as periodic instalments or as a lump-sum.

Loan Amount

1 lac

2 Cr



6 Months

36 Months


Interest Rate




Principal Amount


Interest Amount


Monthly EMI


Total Amount Payable:


What is an Equated Monthly Instalment?

EMI or Equal Monthly Instalment is a part of the equally divided outgoes that are to be paid to the lender to clear the loan amount. EMI is the amount that is paid to the lender every month.The number of instalments made affects the amount of each EMI. The more number of EMI instalments made, the lesser each EMI value will be.

What is an EMI calculator?

In a loan, EMI is constituent of the loan amount along with interest. The interest comes as a percentage of loans. The percentage of interest levied on the loan amount varies from provider to provider. So, to realize the actual loan repayment amount, the borrower must add the interest percentage to the loan amount. For this purpose, EMI calculators exist.EMI calculators make use of loan variables like:
  1. Principal amount
  2. Interest rate
  3. Tenure
  4. Number of instalments
Using these variables of a loan, an EMI calculator can generate the amount of monthly instalment that needs to be paid to clear the loan amount within the stipulated time frame.Calculation: when it comes to the calculation of EMI, online EMI calculators use the following formula-

P x R x ( 1 + R) ^ N

(1 + R )^ N – 1

  1. P – the total amount of loan or the principal amount
  2. R – rate or percent of interest charged each month on loan.
  3. N – number of instalments the borrower wishes to make to clear the loan debt.

Benefits of using an EMI calculator

In any loan agreement, having an EMI calculator can help with the logistics. Getting the numbers right helps in clearing the loan without any further complications, both for the lender and the borrower.Using an EMI calculator can benefit the user in the following ways:
  1. Calculation: Using the calculator can help get all the necessary calculations done. This allows the borrower to have a clear understanding of the financial working and how the EMI amount tallies having the calculations done automatically, the borrower becomes free from the doing the calculations themselves.
  2. Foresight: Using an EMI calculator provides both the lender and the borrower a foresight of how the loan repayment will be carried out. Knowing the amount of EMI payable each month and the number of instalments to be made helps in planning and budgeting finances. This elevates any monetary burden that may arise from clearing the monthly instalment over the specified tenure.
  3. Choosing loan amount: EMI calculators can also be used to assess the feasibility of the prospect of a loan. Borrowers can enter different principal amounts and rates in the calculator and find out different EMIs he/she would have to pay. This is a great way to estimate the budget before applying for a loan. Knowing the long-term repercussions from EMI payment can benefit from choosing the type and amount of loan with maximum advantages. People who have a budget can use an EMI calculator this way to select the loan plan that best suits their needs.
  4. Budgeting: Using an EMI calculator lets you have a clear understanding of how much you will be spending and saving each month. Having this knowledge is crucial in establishing a budget that will provide the right opportunity to better manage your finances. By using an EMI calculator, you can optimize your loan and use the finances most beneficially.
  5. Free from errors: using an EMI calculator is much more efficient than manually doing the calculations. EMI calculators are also completely error free, as long as the data entered is correct. This prevents any unnecessary complications and mistakes that could result from doing the EMI calculations by hand.

Using an EMI Calculator:

Using an EMI calculator is one of the simplest things you can do while planning to buy a loan
  1. Search/ Select the kind of calculator for the type of loan you have chosen or will opt for. (home loan, car loan, business loan, personal loan calculator, etc.)
  2. Enter the required data; this consists of the principal amount, the rate of interest, and the tenure. Some EMI calculators also have the option of the number of instalments you wish to make to clear the loan amount.
  3. Click the calculate button the receive the EMI that needs to be paid for the relevant data.

EMI Calculator FAQs:

1. Where can I get an EMI calculator?

An EMI calculator can be found online on the organization's web page from who you wish to procure a loan. All lenders have an EMI calculator, which you can use to estimate the relevance and applicability of a loan.

2. What happens if I miss an EMI payment?

Upon missing an EMI payment, you will either have to pay a penalty fine or pay extra on the next EMI payment alongside the missed EMI. This varies from lender to lender. Overall, a penalty of some sort will be levied.

3. Which loan’s EMI can I calculate using an EMI calculator?

An EMI calculator can be used to calculate the instalments of any loan. As there are different types of loans, the loan providers may have different calculators that are predominantly for that type of loan. But the core principle remains the same. So, any online EMI calculator cam essentially is used for any loan.

4. Is it better to have a pre-closure on EMI payments?

Reclosing the loan before the tenure ends leads to having a bad credit score. Making timely EMI payments helps keep a healthy credit score for future financial ventures. Alternatively, you can choose to prepay a part of the loan to reduce the total tenure. It should be noted that banks often charge a fee for prepayment on loans.