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Personal Loan EMI Calculator — Calculations & Slabs for FY 2026-27

Enter your personal loan amount, interest rate, and tenure to calculate your monthly EMI and see the total interest cost under the reducing-balance method.

1. Loan Specifications

Frequently Asked Questions (FAQ)

What is a personal loan and how does it work?

A personal loan is an unsecured loan that you can borrow from a bank or financial institution without providing collateral (like property or gold). You repay it in monthly EMIs over a fixed tenure, typically ranging from 12 to 84 months.

Why are personal loan interest rates higher than home loans?

Since personal loans are unsecured, banks take a higher risk in lending without collateral. To offset this risk, banks charge higher interest rates (usually between 10.5% and 36% per annum) compared to home or car loans.

Can I prepay or close my personal loan early?

Yes, most lenders allow prepayment or foreclosure. However, they may charge a foreclosure fee (typically 2% to 5% of the outstanding principal) and usually require you to pay a minimum number of EMIs (like 6 or 12) before doing so.

What parameters determine my eligibility for a personal loan?

Your eligibility is heavily dependent on your credit score (preferably 750+), monthly income, employment stability (salaried vs self-employed), age, and your existing Debt-to-Income ratio (known as FOIR).

Where can I verify the source data for this calculator?

You can verify the values against the official notifications listed in our data sources section at the bottom of the page.

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About This Calculator

Target Audience: Salaried taxpayers, investors & retirees planning Indian tax & wealth growth

💡 What Does This Calculator Do?

This calculator calculates the monthly EMI and total interest payable for an unsecured personal loan. Personal loans usually have higher interest rates and shorter tenures compared to home or car loans.

engine_type: compiled | format: inr

📋 How to Use It

  1. 1
    Loan Amount (₹): Enter the cash amount you wish to borrow.
  2. 2
    Interest Rate (%/year): Enter the annual interest rate (typically 10.5% to 36%).
  3. 3
    Tenure (Months): Enter the loan duration directly in months (usually 12 to 84 months).

🧬 The Logic Explained Simply

  • The Concept: Personal loans are unsecured loans, meaning they require no collateral. Because of this, banks charge higher interest rates. The EMI formula is identical to other loans, but the tenure is directly input in months.
  • The Formula:

EMI = [P × r × (1 + r)^n] / [(1 + r)^n - 1]

where r = (Annual Rate / 12 / 100) and n = Tenure in Months.

💡 Real-World Calculation Breakdown

For example, you take a personal loan of ₹3,00,000 at a 12% interest rate for a tenure of 36 months.

  • Monthly rate (r) = 12 / 12 / 100 = 0.01
  • Monthly EMI = [3,00,000 × 0.01 × (1.01)^36] / [(1.01)^36 - 1] = ₹9,964
  • Total Amount Payable = ₹9,964 × 36 = ₹3,58,704
  • Total Interest Paid = ₹3,58,704 - ₹3,00,000 = ₹58,704

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