EMI calculator — monthly instalment, total interest and total payable
An EMI is one fixed payment that covers two different things: the interest for that month, and a slice of what you borrowed. The payment stays the same every month; what is inside it does not.
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- Monthly instalment (EMI)
- ₹8,884.88
- Total interest
- ₹6,618.56
What each instalment is actually made of
In the first months most of the payment is interest, because interest is charged on what is still outstanding, and at the start almost all of it is outstanding. As the balance falls, the interest part falls with it and more of the same payment goes to the principal.
That is why a loan a third of the way through its term usually has more than a third of its principal still owing — and why the figure on a statement can look wrong when it is not.
A longer tenure costs more at the same rate
Stretching a loan lowers the monthly payment, which is the whole point, but it raises the total interest, because the money is outstanding for longer. The two move in opposite directions and both are real.
The useful comparison is not which EMI is smaller; it is the total payable over the whole term. Run the same amount at two tenures and look at the interest line before you choose.
Prepayment, and the two ways it can be applied
Paying extra against a loan can either shorten the term and keep the EMI the same, or keep the term and lower the EMI. Shortening the term saves more interest; lowering the EMI eases the month.
Which one happens is the lender's rule and sometimes your choice — ask before you pay, because it is hard to change afterwards.
What this does not do
It is the standard reducing-balance formula and nothing else. A real loan can also carry processing fees, insurance, a different compounding convention or a part-month at the start, so the lender's own schedule is the one that binds you.
It is not a loan offer, it checks nobody's eligibility, and it sends nothing anywhere.
Common questions
How is EMI calculated?
EMI = P × r × (1+r)^n ÷ ((1+r)^n − 1), where P is the amount, n is the number of months and r is the monthly rate — the annual rate divided by 12 and by 100. ₹1,00,000 at 12% for 12 months is about ₹8,884.88 a month.
Why does so little of my early EMI reduce the loan?
Interest is charged on the outstanding balance, which is at its highest at the start. The payment is fixed, so the interest part is large early on and shrinks as the balance comes down.
Does a longer tenure make a loan cheaper?
It makes each month cheaper and the loan dearer overall, because the money is borrowed for longer. Compare the total payable, not the monthly figure.
What rate should I enter?
The annual rate your lender quoted. This page divides it by 12 itself, so do not convert it first.
Will my bank's figure match this exactly?
Usually within a rupee or two. Lenders differ on rounding, on fees added to the principal and on how a part-month at the start is treated, so treat the lender's schedule as the real one.
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