A Personal Loan EMI Calculator helps you estimate the monthly installment (EMI) you’d need to pay for your desired loan amount, interest rate, and loan tenure. Here’s a breakdown:

Inputs:

• Loan Amount: The total sum you borrow from the lender for your personal needs.
• Interest Rate: The annual interest rate charged by the lender on the loan amount.
• Loan Tenure: The duration (in years) for which you repay the loan.

Output:

• EMI: The monthly installment amount you’ll pay to the lender, which includes both principal and interest components.

Formula:

The formula used to calculate EMI is the same as the one used for Home Loan EMI calculations:

EMI = [ P x R x (1+R)^N ] / [(1+R)^N - 1]

where:

• P is the loan amount (principal)
• R is the monthly interest rate (annual rate divided by 12 and expressed as a decimal)
• N is the total number of monthly installments (loan tenure in years multiplied by 12)

Example:

Let’s say you want to borrow ₹200,000 for a personal loan at an annual interest rate of 12% for a tenure of 3 years.

1. Monthly Interest Rate (R): 12% / 12 = 0.01
2. Number of Monthly Installments (N): 3 years * 12 months/year = 36 months
3. EMI: [ ₹200,000 x 0.01 x (1 + 0.01)^36 ] / [(1 + 0.01)^36 – 1] ≈ ₹7,463.36

Therefore, your estimated monthly EMI would be approximately ₹7,463.36.

Benefits of using a Personal Loan EMI Calculator:

• Plan your finances: Estimate your monthly loan burden and plan your budget accordingly.
• Compare loan options: Compare different loan offers based on their EMI amounts to choose the most suitable one.
• Negotiate terms: Use the calculated EMI as a reference point while negotiating loan terms with lenders.