# What is an EMI?

Loan amount, tenure and interest rate are the three key parameters of a loan and these vary in case of different loan providers. EMI applicable to a loan varies according to all these three parameters. Therefore, before choosing a particular loan, it is very important to have an understanding of these three parameters and how do they relate to the loan EMI.

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### Calculate Loan EMIs Online Using Loan EMI Calculator

There are different types of EMI calculators based upon the types of loan such as
1. Home loan
2. Personal loan
3. LAP
4. Transfer Home Loan
5. Transfer Personal Loan

### What Factors Can Affect Your Personal Loan EMI?

1. Loan Amount: The higher the loan amount, the higher the EMI payable. The maximum loan amount you can avail is decided by the lender based on your repayment capacity, relationship with the bank, and other factors.

2. Rate of Interest:
In this case, too, the rate of interest is directly proportional to the EMI. The higher the rate of interest, the higher the EMI. The bank will determine your loan’s interest rate based on a number of factors such as your Income, your credit history, repayment capacity, etc.

3. Loan Tenure:
The loan tenure you choose is inversely proportional to the EMI. The longer the tenure, the lower the EMI. However, with longer tenure you may end up paying more as interest. The loan tenure options usually range between 12 months and 84 months.

Loan Amount 1 Year EMI (P.M) 2 Years EMI (P.M) 3 Years EMI (P.M) 4 Years EMI (P.M) 5 Years EMI (P.M) 6 Years EMI (P.M) 7 Years EMI (P.M)
1 Lacs ₹ 8,814 ₹ 4,637 ₹ 3,250 ₹ 2,560 ₹ 2,149 ₹ 1,877 ₹ 1,686
5 Lacs ₹ 44,072 ₹ 23,186 ₹ 16,249 ₹ 12,799 ₹ 10,744 ₹ 9,387 ₹ 8,429
10 Lacs ₹ 88,143 ₹ 46,371 ₹ 32,498 ₹ 25,599 ₹ 21,489 ₹ 18,774 ₹ 16,855
15 Lacs ₹ 1,32,215 ₹ 69,557 ₹ 48,746 ₹ 38,398 ₹ 32,223 ₹ 28,161 ₹ 25,283
20 Lacs ₹ 1,76,288 ₹ 92,743 ₹ 64,995 ₹ 51,197 ₹ 42,978 ₹ 37,548 ₹ 33,711

Rate Of Interest @10.49%*.

### How is Personal Loan EMI calculated?

P: Principal or loan amount
R: Interest rate per month (the annual interest rate is divided by 12 to get the monthly interest rate)
N: Number of monthly installments or loan tenure in months
The mathematical formula for calculating EMIs is EMI = [P x R x (1+R)^N]/[(1+R)^N-1] where EMI: Equated Monthly Instalment

### How to Calculate Personal Loan Monthly Interest Rate?

When you approach a financial institution in order to take a personal loan, the main piece of information you are looking for is the interest rate that is being offered. Once you know it, and before you start using it to calculate the EMI, you need to convert the rate into a monthly one since the interest rate is always presented as an annual rate. To do so, the following formula is used.

Monthly Interest Rate = Interest Rate/12
For Example, if the interest rate offered to you for your personal loan is 18% p.a., then your monthly interest rate will be calculated as follow:
18/12 = 1.5