EMI Calculator
Before the bank tells you the EMI fits your budget, see what the loan really costs: monthly EMI, total interest in lakhs, and the exact principal-vs-interest split.
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Last reviewed: July 20, 2026 · Formulas verified by automated tests before every release.
What banks won't emphasize
- The EMI is designed to feel small. ₹21,696/month sounds manageable; ₹27 lakh of interest on a ₹25 lakh loan is the same deal said honestly. Always look at the donut.
- Prepayment is your superpower: on floating-rate loans to individuals, RBI rules prohibit prepayment penalties — every extra rupee goes straight at the principal and kills future interest.
- Tenure is the biggest lever: the same loan over 15 years instead of 20 raises the EMI ~13% but cuts total interest by roughly a quarter.
- Rate shopping pays in lakhs: compare at least three lenders; existing-customer "top-up" rates are often negotiable.
EMI = P × r × (1+r)ⁿ ÷ ((1+r)ⁿ − 1)
Sources, assumptions and limitations
- Formula: EMI = P × r(1+r)ⁿ ÷ ((1+r)ⁿ − 1), monthly rate r = annual ÷ 12 (standard reducing-balance method)
- Assumptions: Fixed rate, equal monthly instalments — the convention used by Indian banks and NBFCs for the quoted EMI.
- Not included: Processing fees, insurance bundling, GST on charges, floating-rate resets. RBI directs banks to charge no foreclosure penalty on floating-rate loans to individuals — verify your loan's terms.
- Last reviewed: July 22, 2026 by the CalcNotebook team
Frequently asked questions
How is EMI calculated?
EMI = P × r × (1+r)ⁿ ÷ ((1+r)ⁿ − 1), where P is the loan amount, r the monthly rate and n the tenure in months. A ₹25 lakh loan at 8.5% for 20 years gives an EMI of about ₹21,696.
How can I reduce my EMI or total interest?
Three levers: a shorter tenure (higher EMI, dramatically less interest), part-prepayments (RBI mandates zero prepayment penalty on floating-rate loans to individuals), and negotiating the rate — even 0.25% off a 20-year home loan saves lakhs.
Why is the interest share so large?
Long tenures do it: on a 20-year home loan at 8.5%, interest is roughly 52% of everything you pay — the donut above shows your exact split. It's the honest cost of spreading payments thin.
Is this for home, car or personal loans?
All of them — the formula is identical. Only typical rates differ: home loans ~8–9.5%, car loans ~9–11%, personal loans ~11–18%. Enter your quoted rate.