EMI calculator
The monthly instalment on a loan, the interest over its life, and the balance at the end of every year.
Free, with no sign-up Worked out in your browser The working shown, line by line
The answer
| The loan | |
| Amount borrowed | 25,00,000.00 |
| Rate 0.75% a month | 9% a year |
| Term | 240 months |
| Instalment | 22,493.15 |
| Balance at the end of each year | |
| Year 1 From 25,00,000.00: interest 2,23,100.03, principal 46,817.77 | 24,53,182.23 |
| Year 2 From 24,53,182.23: interest 2,18,708.20, principal 51,209.60 | 24,01,972.63 |
| Year 3 From 24,01,972.63: interest 2,13,904.38, principal 56,013.42 | 23,45,959.21 |
| Year 4 From 23,45,959.21: interest 2,08,649.94, principal 61,267.86 | 22,84,691.35 |
| Year 5 From 22,84,691.35: interest 2,02,902.59, principal 67,015.21 | 22,17,676.14 |
| Year 6 From 22,17,676.14: interest 1,96,616.10, principal 73,301.70 | 21,44,374.44 |
| Year 7 From 21,44,374.44: interest 1,89,739.90, principal 80,177.90 | 20,64,196.54 |
| Year 8 From 20,64,196.54: interest 1,82,218.66, principal 87,699.14 | 19,76,497.40 |
| Year 9 From 19,76,497.40: interest 1,73,991.87, principal 95,925.93 | 18,80,571.47 |
| Year 10 From 18,80,571.47: interest 1,64,993.36, principal 1,04,924.44 | 17,75,647.03 |
| Year 11 From 17,75,647.03: interest 1,55,150.72, principal 1,14,767.08 | 16,60,879.96 |
| Year 12 From 16,60,879.96: interest 1,44,384.78, principal 1,25,533.02 | 15,35,346.94 |
| Year 13 From 15,35,346.94: interest 1,32,608.92, principal 1,37,308.88 | 13,98,038.05 |
| Year 14 From 13,98,038.05: interest 1,19,728.40, principal 1,50,189.40 | 12,47,848.65 |
| Year 15 From 12,47,848.65: interest 1,05,639.59, principal 1,64,278.21 | 10,83,570.45 |
| Year 16 From 10,83,570.45: interest 90,229.17, principal 1,79,688.63 | 9,03,881.81 |
| Year 17 From 9,03,881.81: interest 73,373.13, principal 1,96,544.67 | 7,07,337.14 |
| Year 18 From 7,07,337.14: interest 54,935.89, principal 2,14,981.91 | 4,92,355.23 |
| Year 19 From 4,92,355.23: interest 34,769.10, principal 2,35,148.70 | 2,57,206.53 |
| Year 20 From 2,57,206.53: interest 12,710.53, principal 2,57,206.53 | 0.00 |
| Interest over the whole term | 28,98,355.26 |
- Interest is charged on the reducing balance, so the early instalments are mostly interest and the late ones mostly principal.
Not statutory. The reducing-balance formula every lender uses.
How it is worked out
Every lender works the instalment out the same way, on the reducing balance: EMI = P × r × (1 + r)ⁿ ÷ ((1 + r)ⁿ − 1), where P is the amount borrowed, r the rate a month and n the number of months.
Each month the interest is charged on what is still owed, and the rest of the instalment pays the loan down. That is why the interest share is largest at the start and shrinks every month.
The schedule below the answer runs the loan a month at a time and shows what is still owed at the end of each year, with the interest and principal paid in it.
Worked example: A home loan of ₹25 lakh at 9% for 20 years
The instalment comes to about ₹22,493 a month, and the interest over the twenty years to about ₹29 lakh - more than the loan itself.
Questions
Why are the first EMIs mostly interest?
Interest is charged on the balance still owed, which is largest at the start. As the balance falls, so does the interest, and more of the same instalment goes to the principal.
Does a lower rate or a shorter term save more?
Both cut the interest, but shortening the term usually saves far more than a small rate cut, because the balance is outstanding for fewer months. Change either field and compare the interest over the term.
What happens if I prepay part of the loan?
If the instalment stays the same, the loan ends sooner and the interest falls. The loan prepayment calculator shows how much is saved, in rupees and in months.
The same answer, on every client, with the working paper written for you
KiyoTool reads a client’s whole loan register and writes the repayment schedules and the current portion the balance sheet needs, beside calculators for prepayment, restructuring, the effective rate, interest cover and debt service cover. It runs on Windows, offline, and your clients' books never leave the machine.