What does EMI mean?
An equated monthly instalment combines principal repayment and interest. In a reducing-balance loan, interest is charged on the outstanding principal. Early payments usually contain more interest; later payments repay more principal. This model assumes a constant rate and equally spaced monthly payments.
EMI formula
P is the loan amount, i is the nominal annual rate divided by 12 and 100, and m is the number of monthly payments.
At zero interest, EMI equals P/m. Each month, interest equals opening balance × i; the rest of the payment reduces principal.
Worked repayment example
A ৳100,000 loan at zero interest over 10 months has an EMI of ৳10,000. Paying an additional ৳10,000 each month repays it in five months. At positive interest, extra principal payments can also reduce total interest. The final instalment is capped at the balance and interest still due.
Use the amortization schedule
The table shows the first payment, year ends and final payment; the CSV includes every month. Compare total outflow including upfront fees, not only the monthly EMI. This calculator does not model flat-rate loans, changing rates, daily accrual, insurance or prepayment penalties unless you account for those costs separately.
Frequently asked questions
Is this a flat-rate loan calculator?
No. It uses monthly reducing-balance interest. A flat-rate quote cannot be compared directly without conversion.
Do extra payments reduce the scheduled EMI?
The scheduled EMI stays the same. Extra payments shorten repayment in this model.
Are upfront fees borrowed?
No. They are paid separately and added to total outflow.
Methodology: StockView calculation model 3.0. For planning and education; results depend on your inputs. No calculator inputs are submitted by this module.