Question 1

How is EMI calculated?

Accepted Answer

This page uses the standard reducing-balance equated monthly installment. Let P be the loan principal, R the annual interest rate in percent, and n the number of months (tenure in months, or years × 12). Monthly rate r = (R/100) / 12. If r is about 0, EMI = P / n. Otherwise EMI = P × r × (1+r)^n / ((1+r)^n − 1). Total payment = EMI × n. Total interest = total payment − P.

Question 2

What is reducing-balance interest?

Accepted Answer

Each EMI first covers that month's interest on the outstanding principal; the rest reduces the principal. Next month's interest is charged on the lower balance. That is the equated monthly installment most Indian home, auto, and personal loans use — not a flat rate charged on the original principal for the whole tenure.

Question 3

Can I switch tenure between years and months?

Accepted Answer

Yes. Use the Years or Months control next to the tenure box. Years becomes n = years × 12 (5 years is 60 months). Months uses the number as-is. The calculator does not rewrite the tenure box when you change units; 5 years and 5 months are different tenures. Recalculation runs live on input and unit change.

Question 4

Is anything uploaded?

Accepted Answer

No. Loan amount, rate, tenure, and the math run in your browser. Nothing is sent to ToolPetal.

EMI calculator