How to use the EMI Calculator
- 1
Pick the loan type: Home, Car or Personal. Each one loads typical starting values that you can change.
- 2
Set the loan amount and the annual interest rate quoted by your bank, either by typing or by dragging the slider.
- 3
Choose the tenure in years or months.
- 4
Read your monthly EMI, total interest and total payment, and check the donut to see how much of the payment is interest.
- 5
Scroll to the schedule and tap any year to open its month-by-month breakdown.
The EMI formula, worked through with real numbers
Banks in India use the reducing-balance method, so interest is charged only on the amount you still owe. The formula is EMI = P × r × (1 + r)^n ÷ ((1 + r)^n − 1). P is the loan amount, r is the monthly rate (annual rate ÷ 12 ÷ 100) and n is the number of monthly instalments.
Take a loan of ₹10,00,000 at 10% a year for 10 years. The monthly rate is 10 ÷ 12 ÷ 100 = 0.008333, and n is 120. Raising 1.008333 to the power 120 gives about 2.7070. Plug that in and the EMI comes to ₹13,215.
Over 120 months you pay ₹15,85,809 in all, which means ₹5,85,809 is interest. In the very first month, ₹8,333 of your ₹13,215 goes to interest (that is 0.8333% of ₹10 lakh) and only ₹4,882 reduces the loan. By the last year the split has flipped. Open Year 1 in the schedule above and you can watch the principal part creep up every single month.
If the rate is 0%, as with some no-cost EMI offers on phones and appliances, the formula breaks down, so the calculator simply divides the amount by the number of months.
How tenure changes what you really pay
A longer tenure lowers the EMI, which is why it is tempting. The catch is that you pay interest for many more years. Here is a ₹30 lakh home loan at 8.5% across different tenures:
| Tenure | Monthly EMI | Total interest | Total payment |
|---|---|---|---|
| 10 years | ₹37,196 | ₹14,63,485 | ₹44,63,485 |
| 15 years | ₹29,542 | ₹23,17,594 | ₹53,17,594 |
| 20 years | ₹26,035 | ₹32,48,327 | ₹62,48,327 |
| 25 years | ₹24,157 | ₹42,47,044 | ₹72,47,044 |
| 30 years | ₹23,067 | ₹53,04,266 | ₹83,04,266 |
Going from 20 to 30 years saves you about ₹3,000 a month but adds more than ₹20 lakh of interest. Going from 20 down to 15 years costs about ₹3,500 more a month and saves over ₹9 lakh. A sensible rule many borrowers follow is to keep all EMIs together under roughly 40% of take-home pay, then choose the shortest tenure that fits inside that limit.
Prepayment: small extra payments, big savings
Because interest is worked out on the outstanding balance, any extra money you pay early cuts the interest on everything that follows. Two examples on the same ₹30 lakh, 8.5%, 20-year loan, keeping the EMI unchanged:
- A one-time prepayment of ₹2 lakh at the end of the first year saves about ₹6.9 lakh of interest and closes the loan roughly 34 months early.
- Paying one extra EMI (₹26,035) every year saves about ₹6.2 lakh and finishes the loan around 39 months sooner.
RBI rules do not allow banks to charge prepayment penalties on floating-rate loans taken by individuals, so most home loan borrowers can prepay freely. Fixed-rate loans and many personal and car loans may carry a foreclosure charge, so read the sanction letter first. When you prepay, ask the bank to reduce the tenure rather than the EMI if you want the largest saving.
Reading the year-wise schedule
The table under the calculator groups the 12 instalments of each loan year. Year 1 means your first 12 EMIs, not the calendar year, so if your loan starts in October the rows will not line up with April-to-March financial years.
For a home loan, the yearly interest figure is a handy estimate when you plan tax. Under the old tax regime, interest on a self-occupied house is deductible up to ₹2 lakh a year, and the principal part qualifies within the same ₹1.5 lakh limit used for PPF and ELSS. The new tax regime does not give these deductions for a self-occupied home. For the exact numbers, rely on the interest certificate your lender issues each year.
What this EMI figure leaves out
The calculator assumes a fixed rate for the whole tenure. Most home loans in India are floating and linked to an external benchmark such as the repo rate, so your rate can move a few times over 20 years. When rates rise, banks usually extend the tenure first and keep the EMI the same, which quietly increases total interest.
The result also excludes processing fees, legal and valuation charges, stamp duty, loan insurance that is sometimes bundled with the loan, and GST on fees. Your first EMI may differ too, because many lenders charge broken-period interest for the days between disbursal and the first EMI date. Treat this as a planning tool, not a loan offer, and compare the bank's own schedule before you sign.
Frequently asked questions
How is EMI calculated in India?
Lenders use the reducing-balance formula EMI = P × r × (1 + r)^n ÷ ((1 + r)^n − 1), where r is the monthly interest rate and n is the number of months. Each EMI first covers that month's interest on the outstanding balance, and the rest reduces the principal.
What is the EMI for a ₹10 lakh loan?
At 10% for 10 years the EMI is about ₹13,215. At 8.5% for 20 years it falls to about ₹8,678, but you pay far more interest overall. Enter your own rate and tenure above to get the exact figure.
Is it better to choose a lower EMI or a shorter tenure?
A shorter tenure almost always costs less in total because you pay interest for fewer years. Choose a lower EMI only if the higher one would stretch your monthly budget. You can start with a comfortable EMI and prepay whenever you get a bonus.
Why is most of my early EMI going towards interest?
Interest is charged on the balance you owe, and at the start that balance is at its highest. As you repay, the interest part shrinks and the principal part grows, even though the EMI stays the same.
Does the EMI change when the RBI changes the repo rate?
For a floating-rate loan linked to the repo rate, your interest rate changes after the bank's reset date. Many banks adjust the tenure instead of the EMI, so check your loan statement after any rate change.
Does this calculator include processing fees or insurance?
No. It shows the pure loan repayment. Processing fees, insurance premiums, stamp duty and other charges are extra, so add them separately when comparing loan offers.
Last updated on November 9, 2026