What is EMI?
EMI stands for Equated Monthly Installment. It is the fixed payment amount made by a borrower to a lender at a specified date each month. EMIs are used to pay off both principal and interest components so that the loan is repaid over a specified tenure.
EMI formula (simple)
The standard formula to calculate EMI is:
EMI = P × r × (1 + r)^n / ((1 + r)^n − 1)
where:
- P = principal loan amount
- r = periodic interest rate (annual rate ÷ payments per year)
- n = total number of payments (tenure × payments per year)
How to use Pentocalc Emi calculator
- Enter the loan amount.
- Enter the Annual interest rate.
- Enter the Tenure
- select between years/months and different payment (monthly, quarterly).
- Use the download button to get the full payment schedule.
Example
Suppose you take a loan of ₹10'00,000 at 7.5% per annum for 10 years, with monthly payments. The calculator computes the monthly EMI, total payment over the loan, and total interest paid.
How to reduce EMI or interest
- Opt for a shorter tenure if you can afford a higher EMI — this reduces total interest paid.
- Negotiate for a lower interest rate when refinancing or switching lenders.
- Make prepayments when possible to reduce principal and future interest; check lender prepayment rules and penalties.
- Choose flexible payment frequency if it aligns better with your cash flow (e.g., quarterly if you receive income quarterly).
Common Questions (FAQ)
Q: Is EMI the same as interest?
A: No. EMI includes both principal and interest components. Initially, interest portion is higher and principal portion increases over time (amortization).
Q: Can EMI change during the loan?
A: If you have a fixed-rate loan with fixed EMI, it generally doesn't change. For floating-rate loans, the EMI may be recalculated when the interest rate changes.
Q: Should I prepay loans?
A: Prepaying reduces outstanding principal and future interest. Check for prepayment penalties. Even occasional prepayments can lower the overall interest burden significantly.
Amortization schedule
The amortization schedule breaks down each payment into interest and principal components and shows the remaining balance after each payment. Use it to understand how much interest you'll pay in the early years versus later years.
Accessibility & mobile usability
The calculator is responsive and uses semantic markup and labels for accessibility. The result area uses an aria-live region to announce results for screen reader users.
Conclusion
Use this EMI Calculator to plan loans, compare options, and make informed borrowing decisions. Adjust the loan amount, rate or tenure and download the amortization CSV to review payments offline.