Loan / EMI Calculator
Enter a loan amount, rate and term to see the monthly payment, total interest, and how the balance falls year by year.
How loan payments work
Almost every consumer loan — car, personal, student — is repaid in equal monthly instalments. The lender's formula guarantees the loan is exactly repaid at the end of the term while charging interest on whatever balance remains each month. Because the balance starts high, early payments are interest-heavy; as the balance falls, more of each fixed payment chips away at the principal. That shifting mix is called amortisation.
Worked example: borrow $10,000 at 7% APR for 3 years (36 months). The monthly rate is 0.5833%, and the payment comes out at $308.77 per month. Over the loan you repay $11,115.75 in total, so the credit costs you $1,115.75 in interest — a useful figure to compare before signing anything.
Two levers matter most when comparing loans: the rate and the term. A longer term always lowers the monthly payment but raises the total interest, sometimes steeply. If two offers have the same rate, the shorter term is almost always the cheaper loan overall.
Frequently asked questions
What is EMI?
EMI stands for Equated Monthly Instalment — the fixed amount you pay a lender every month. Each payment covers interest on the outstanding balance plus a slice of principal; early payments are mostly interest, later ones mostly principal.
What is the EMI formula?
EMI = P × r × (1+r)^n ÷ ((1+r)^n − 1), where P is the loan principal, r is the monthly interest rate (annual rate ÷ 12), and n is the number of monthly payments. If the rate is 0%, the payment is simply P ÷ n.
How can I reduce the total interest I pay?
Borrow less, choose a shorter term, or secure a lower rate — all three shrink total interest. A shorter term raises the monthly payment but can cut total interest dramatically; making occasional extra payments has the same effect.
What is an amortisation schedule?
It is the full table of payments over the loan's life showing, for each period, how much goes to interest, how much to principal, and the remaining balance. This calculator shows a year-by-year summary of that schedule.