How is EMI calculated?
EMI is calculated as P x r x (1 + r)^n divided by ((1 + r)^n - 1), where P is the loan amount, r the monthly rate (yearly rate / 12 / 100) and n the months. Enter the loan amount, rate and tenure in FixDoks's EMI Calculator to see EMI, total interest and schedule.
EMI Calculator at a glance
| Inputs | Loan amount, interest rate, tenure, optional extra payment |
|---|---|
| Output | Monthly EMI, total interest, amortisation schedule |
| Processing | In your browser; your files are not uploaded |
| Price | Free |
| Works on | Chrome, Edge, Safari and Firefox on Windows, Mac, Android and iPhone |
How to use EMI Calculator
- Enter the loan amount, or tap a preset such as Home loan or Car loan.
- Set the yearly interest rate and the tenure in years or months.
- Read your monthly EMI, total interest and total payment. The chart and schedule update as you type.
- Optional: add an extra monthly payment to see how much interest a part-prepayment saves, then download the schedule as CSV.
What is an EMI?
An EMI (equated monthly instalment) is the fixed amount you pay the lender every month until the loan is repaid. Each EMI has two parts: interest on the balance still outstanding, and a slice of the principal. In the early years most of the EMI goes to interest. As the balance falls, the interest part shrinks and the principal part grows, even though the EMI itself stays the same.
What is the EMI formula?
Banks in India and most lenders worldwide use the reducing-balance formula:
EMI = P × r × (1 + r)n ÷ ((1 + r)n − 1)
- P is the loan amount (principal).
- r is the monthly interest rate, which is the yearly rate ÷ 12 ÷ 100.
- n is the number of monthly instalments.
Worked example
Take a home loan of ₹10,00,000 at 8.5% a year for 20 years.
- r = 8.5 ÷ 12 ÷ 100 = 0.0070833
- n = 20 × 12 = 240
- (1 + r)240 = about 5.4448
- EMI = 10,00,000 × 0.0070833 × 5.4448 ÷ 4.4448 = ₹8,678
Over 240 months you pay ₹20,82,776 in total, so the interest cost is about ₹10,82,776, slightly more than the amount you borrowed. In the first month, interest is ₹7,083 and only ₹1,595 reduces the principal. That is why the schedule above is worth reading before you sign.
How do tenure and rate change your EMI?
A longer tenure lowers the EMI but raises the total interest sharply. The same ₹10 lakh at 8.5% costs ₹12,399 a month over 10 years, with total interest of about ₹4.9 lakh, compared with ₹10.8 lakh over 20 years. A rate cut of even 0.5% makes a noticeable difference on a long home loan, which is why many borrowers move their loan to a lender with a lower rate (a balance transfer) when the saving is large enough to cover the fees.
Does prepayment help?
Yes. Any extra amount you pay goes straight to the principal, so every later month charges interest on a smaller balance. Enter an amount in Extra payment every month to see the new closing date and interest saved. In India, floating-rate home loans taken by individuals generally carry no prepayment penalty, but fixed-rate and business loans may. Ask your lender.
Typical loan types
| Loan | Common tenure | Notes |
|---|---|---|
| Home loan | 15 to 30 years | Usually floating rate linked to a repo-based benchmark |
| Car loan | 3 to 7 years | Often fixed rate |
| Personal loan | 1 to 5 years | Unsecured, higher rates |
| Education loan | 5 to 15 years | Repayment often starts after the course |
The calculator also works for loans in dollars, euros, pounds or dirhams: change the currency and the maths stays the same. It does not include processing fees, insurance bundled into the loan, or GST on charges.
Results are estimates for planning. Your bank, fund house or the tax department may round differently or apply extra charges, so check the final figure with them.