Personal Loan EMI Calculator
Personal Loan EMI
What will this personal loan actually cost you?
Monthly EMI
₹0
principal plus interest
Processing fee
₹0
taken off the disbursal
Actually credited
₹0
after the fee
Effective annual cost
0%
counting the fee
The advertised rate is not what you pay
A processing fee is deducted before the money reaches you, but you repay interest on the full sanctioned amount. That gap is why the effective cost is always above the headline rate — and why two loans at the same rate can cost very different amounts.
Personal loans are the most expensive mainstream credit
At 12–24% a year, a personal loan costs roughly twice a home loan and three times a loan against securities. It is unsecured, so the rate reflects the lender's risk, not yours. If you have an asset to borrow against, almost anything is cheaper.
Check the prepayment terms before you sign
Many personal loans carry a 2–5% prepayment penalty, or bar prepayment entirely for the first twelve months. If there is any chance you will clear it early, that clause is worth more than a small difference in the interest rate.
Illustration only. Assumes a fixed reducing-balance rate, equal monthly instalments and no prepayment. Excludes GST on the processing fee, insurance bundled by the lender, late-payment charges and any prepayment penalty — all of which raise the real cost. Lenders quote rates on a risk-graded basis, so the rate offered to you may differ from the advertised one. Not a loan offer.
Frequently asked questions
What is EMI and how is it calculated?
EMI (Equated Monthly Installment) is the fixed monthly payment that repays a loan over its tenure, made up of principal and interest combined. It's calculated from the loan amount, interest rate, and tenure using a standard amortization formula -- the same one this calculator uses, so you can see the exact monthly figure and how much of each payment goes to interest versus principal.Read more: The Credit Card Minimum Due Is Designed to Keep You Paying Forever
Does prepaying a loan actually save money?
Yes, almost always -- a prepayment reduces the outstanding principal, which reduces the interest charged on every remaining installment. The earlier in the loan you prepay, the more you save, since interest is front-loaded in most amortization schedules. Check for prepayment penalties with your lender first.Read more: The Insurance Hiding Inside Your Car Loan
What's the difference between flat rate and reducing balance interest?
Flat-rate interest is charged on the full original loan amount for the entire tenure, even as you pay it down -- reducing-balance interest is charged only on what's still outstanding, so it falls every month as you repay. A flat rate quoted at the same percentage as a reducing-balance rate is effectively much more expensive; always confirm which method a lender is using.Read more: Rate Hikes Travel First Class, Rate Cuts Walk
Will improving my credit score lower my loan interest rate?
Usually, yes. Lenders price risk into the interest rate they offer, and a higher credit score signals lower risk, which typically qualifies you for better rates. It varies by lender and loan type, but it's one of the few loan-cost factors largely within your control before you apply.Read more: The Credit Card Minimum Due Is Designed to Keep You Paying Forever
Estimates only, not financial advice. See our Disclaimer.
