EMI Calculator: Estimate a Monthly Loan Payment
An EMI (equated monthly instalment) estimate helps compare a fixed-rate loan’s monthly payment with a household budget. Enter the amount borrowed, annual rate, and term to see a standard amortizing-payment estimate.
How to use this tool
- Enter the principal or loan amount.
- Enter the annual interest rate as a percentage.
- Enter the repayment term in years.
- Select Calculate to view the estimated monthly payment, total repaid, and interest amount.
- Compare estimates using lender-provided fees and terms before making a decision.
Options explained
The calculation converts the annual rate to a monthly rate and uses the stated number of monthly payments. At zero interest, it divides principal evenly across the term.
Accuracy and limitations
This calculator is an estimate, not a loan offer or quote. It excludes fees, insurance, taxes, rate changes, payment timing and lender-specific rules. Contact a licensed lender for an exact schedule.
The formula
The tool divides the yearly rate by 12 to get the monthly rate r and multiplies the number of years by 12 to get the number of payments n. The monthly instalment is P x r divided by (1 minus (1 + r) to the power of minus n), where P is the loan amount. If the rate is zero, the instalment is simply the amount divided by the number of months. All payments are equal and the rate is fixed.
Worked examples
A loan of 1,000,000 at 10 percent a year for 20 years has 240 payments of about 9,650.22, a total of about 2,316,052 and interest of about 1,316,052. A loan of 500,000 at 12 percent for 3 years has 36 payments of about 16,607.15, a total of about 597,858 and interest of about 97,858. The result is shown with a dollar sign but the numbers work for any currency.
Using an estimate to decide
A good rule is to check that the monthly instalment is a comfortable part of your regular income, and to compare several terms. A longer term makes the instalment smaller and the total interest bigger. Ask the lender for the real schedule, because fees, insurance, a changing rate and special rules for Islamic financing can change the real cost, and a bank's figure may differ from this estimate.
Frequently asked questions
How is EMI calculated?
EMI = P x r x (1 + r)^n divided by ((1 + r)^n - 1), where P is the loan amount, r is the monthly interest rate (annual rate divided by 12 and by 100) and n is the number of months. The result is an estimate, and your lender may add fees.
Is EMI the same as a monthly loan payment?
Yes. EMI means equated monthly instalment, an equal payment each month.
Does it include processing fees?
No. Add fees and insurance from the lender's offer.
What happens at 0 percent interest?
The amount is divided equally over the months.
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