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How EMI Is Calculated on A Personal Loan?

Personal Loan

When you take a loan, the equated monthly instalment is a key factor in deciding the loan amount and tenure. The personal loan calculator helps you instantly calculate personal loan EMI and, therefore, plan your loan and repayment better. 

The EMIs one pays remains largely uniform throughout the loan tenure. Moreover, the amounts repaid are credited towards the interest and principal to be repaid. With later instalments paying towards the principal, typically, the initial instalments contribute more towards the interest amount. To get the break-up of these amounts repaid towards interest and principal, you can consult an amortisation schedule. This also shows balances through every year of the loan. 

What is a Personal Loan EMI Calculator?

The Personal Loan EMI Calculator is a tool that can be used online to determine the amount of the EMI that a borrower is required to pay back each month to pay off the loan. The Equated Monthly Instalment (EMI) Calculator determines the EMI, Interest due till the loan duration, and the Balance Loan Amount for a certain period by taking into account the Loan Amount, Interest Rate, and Loan Tenure. 

How to calculate personal loan EMI?

The following is the formula that is used in mathematics to calculate loan EMI:

EMI = [P x R x (1+R)^N]/[(1+R)^N-1]


“P” stands for the amount of the Principal Loan,

“R” is the Rate of Interest (per month) or the Annual Return on Investment divided by 12.

“N” is an abbreviation for Loan Tenure (in months)

However, the amount of the EMI may change at the time of loan distribution based on the date of the payout as well as the length of time that will pass between the disbursement date and the date of the first EMI. You can easily calculate loan EMI using this formula or a calculator.

How can a loan calculator help you?

Calculating personal loan EMI for a personal loan rate of interest is a difficult one involving several factors. People not very familiar with the minute intricacies of calculating personal loan EMI may find that it is not easy to do the calculations yourself. In the circumstances like these, having access to a personal loan rate of interest may be of tremendous assistance.

  • It is possible to calculate personal loan EMI in seconds, sparing the user valuable time they may otherwise use toward more fruitful endeavours.
  • This prevents the possibility of the computations being inaccurate in any way.
  • Providing you with up-to-date information makes it possible to prepare an advance plan for how you will return the debt.

What Are the Benefits of Using the EMI Calculator?

Using an EMI calculator for personal loans has some advantages, some of which are listed below.

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To receive an estimate of the monthly obligation for the personal loan rate of interest, you will need to enter the total amount of the loan and make adjustments to the interest rate and the length of the loan.

Save time

When using the EMI calculator for personal loans, calculating the monthly payment takes less than a minute. EMI calculators are also extremely simple and provide precise results every time.

Choose your preferred borrowing time

Enter some alternative loan maturities, then determine how each affects the EMI. Going for a shorter loan is the best option if you want to pay off your loan faster and are willing to pay a higher EMI. In such cases, you always have the option of selecting a lengthier tenure.


Personal loans are almost always unsecured, which means that any assets do not secure the loan that the lender may seize if the borrower cannot repay the debt. This leaves the borrower vulnerable to having their assets repossessed by the lender. Knowing how to calculate loan EMI can prevent this situation.