Personal loans are one of the most accessible products if you’re looking for some quick financial assistance. With swift disbursements, online accessibility, and no collateral requirements, getting a personal loan is probably the smartest way to acquire funds in times of need.

Personal loans are generally cleared through EMIs (Equated Monthly instalment), which is a fixed monthly payment divided equally throughout your chosen tenure. Having an understanding of personal loan EMI payments before borrowing is a healthy practice. This helps you determine the right tenure, and compare different lenders to choose a loan product that will be the best for you.

Now you may be wondering how to calculate EMI for personal loan. Well, before that, let us understand the factors affecting EMI amount.

Here are the factors which affect the personal loan EMI –

  • Principal: The EMIs are directly proportional to the principal amount, which is the amount that you’ll be borrowing. A higher principal will result in a higher EMI.
  • Rate of interest: This is the interest that you will be paying to the lender for borrowing. The EMI is directly proportional to the rate of interest, which means greater the rate, more the EMI.
  • Tenure: Tenure is the period across which the loan is cleared. A long tenure means a lower monthly EMI amount, but more number of installments.

Additional Read: 5 Ways to Manage your Personal Loan EMI Payments

Now that we’ve taken care of the terminologies, let’s see how you calculate your personal loan EMI.

1. Fix your principal

This is the easiest step, and an important one, as it will directly affect the EMI amount. Carefully strike a balance between the down payment amount and principal, to get the most out of your personal loan. Also, look for any offers or discounts you can avail to reduce the principal before opting for the loan.

2. Choose a loan provider

Different providers charge different interest rates. Therefore, carefully choosing a trusted provider with a comparatively lower rate of interest becomes an essential step in regulating your EMI amount. Be wary of companies charging ultra-low rates of interest though, as there may be some caveats involved.

3. Decide your tenure

A longer tenure will reduce your EMI amount, but will in turn increase the total instalments. In such cases, you end up paying more in interest, even though the monthly payments are small. Carefully balance both the tenure and number of repayments.

Calculate EMI for Personal Loan

4. The formula

Plug in the values of tenure, rate of interest and principal in the following formula:

E = P * r * (1+r) ^n / ((1+r) ^n-1)


  • E is EMI
  • r is the rate of interest
  • n is the tenure or total duration
  • P is the principal amount

Voila! You’ve successfully calculated your EMI.

Additional Read: How to calculate personal loan EMI manually

The above process can be cumbersome, mainly if you’re calculating EMI for different rates of interest and tenure. We at Tata capital have made the job easy for you. Use our very own personal loan EMI calculator and get your desired EMI within seconds without any hassles.

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