Personal loan EMI calculator: How to compute your monthly repayment, key determinants and more

When you apply for a personal loan, you need to consider several factors, including comparing the interest rates and processing charges of different banks and, importantly, computing the monthly instalment using a personal loan EMI calculator.

The three factors mentioned above can help you land the best deal as you raise a personal loan. For example, when you use a personal loan EMI calculator, you would know how much monthly instalment you would have to pay at what interest rate so as to repay the loan in a pre-determined time frame.

You can access the Livemint personal loan EMI calculator here:

What is a personal loan EMI calculator?

A personal loan EMI calculator helps you compute the exact EMI (equated monthly instalment) in order to repay the personal loan at a fixed rate of interest in a pre-determined time period.

So, the EMI calculator has three determinants: loan tenure, rate of interest, and loan amount. The interest rate and loan amount are directly proportional to the EMI, which means the higher the interest rate or loan amount, the higher the EMI.

Conversely, lower these numbers, and the monthly instalment will be lower.

Additionally, loan tenure is inversely proportional to the monthly instalment. This means the longer the loan tenure, the smaller the EMI and the shorter the tenure, the larger the EMI.

So, these are the three key factors that determine the monthly instalment, i.e., equated monthly instalment (EMI) of a personal loan.

A. Loan amount: This refers to the total amount of loan raised by a borrower. Suppose you decide to take a loan of ₹5 lakh.

B. Rate of interest: This is the interest rate charged by the bank on a personal loan. It typically is more than 10 per cent per annum and can go higher. For convenience, let us suppose the interest rate is 10 per cent.

C. Loan tenure: This is the time period that you will take to repay the loan. Let us say you took 36 months to repay the loan — then the tenure will be 36 months.

When you insert these three figures into a personal loan EMI calculator, you will get the exact monthly EMI. In the above-mentioned case, the monthly EMI is ₹16,133.

Interestingly, these figures tend to give exactly the same results regardless of which EMI calculator you happen to use.

One of the most convenient EMI calculators that one can use is the Livemint personal loan EMI calculator, which can be accessed here wherein you can move a slider bar to check how EMI increases or decreases based on the inputs you put. Additionally, you can also use different personal loan EMI calculators shared by respective banks on their website. 

For instance, you can access EMI calculators given by HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Axis Bank, AU Small Finance Bank and Bank of Baroda, among others. 

For instance, in the above-mentioned illustration, if you happen to raise the loan amount to ₹6 lakh from ₹5 lakh by sliding the scale rightward while other inputs (interest rate and tenure) remain constant, the monthly instalment will increase proportionately to ₹19,360.