What is an EMI?
An EMI (Equated Monthly Installment) is a certain amount of money that a borrower pays to repay a debt to the lender each month. EMI includes the loan amount and interest that needs to be paid until the whole loan is fully repaid.
When we take out a loan, the bank calculates the Equated Monthly Installment based on the loan amount, the interest rate, and the loan tenure (the period over which the loan will be repaid). EMI helps us by dividing a loan in small installments so that it will be easier to manage finance.
How Does an EMI Calculator Work?
Our EMI calculator is easy to use. We need to provide the following details:
● Loan Amount: We need to enter the total amount we borrow from the bank.
● Interest Rate: The rate at which the bank charges interest on the loan amount.
● Loan Tenure: The period over which we plan to repay the loan (months or years).
How do you calculate EMI?
To calculate the EMI, the bank uses a formula:
EMI = [P x R x (1+R) ^N]/ [(1+R) ^ (N-1)]
where –
● P is the principal amount
● R is the rate of interest
● N is the loan tenure
After entering all the details, our calculator computes the EMI showing Monthly EMI, Interest Payable, Total Amount Payable instantly.
In case of fixed-rate loans, EMI remains constant throughout the period. However, if we choose a floating-rate loan, the EMI might change with changing interest rates.
Benefits of Using Loan EMI Calculator
● Instant and Accurate Results
● Helps in Financial Planning
● Compare Multiple Loan Offers
● Save Time and Effort
● Free and Accessible Anytime
Factors Affecting EMI Calculation
EMI depends on various factors that influence our monthly payment amount. Some factors that affect the EMI of a loan are:
● Loan Amount: If our loan amount is large then there will be higher EMI and vice versa.
● Interest Rate: Higher interest rates result in higher EMIs. Even a small change in the interest rate can significantly impact our monthly EMI.
● Loan Tenure: A longer loan tenure reduces our monthly EMI but increases the total interest we need to repay the loan completely. A shorter tenure means higher EMIs, but lower total interest paid.
● Type of Interest: Fixed and floating interest rates affect EMI differently.
How much loan can I take ?
You can use our loan eligiblity checker to know how much loan you can take based on your current income and liabilities.
Types of Loans and EMI Calculations
The following are the most widely used types of loans for which you can make use of the EMI calculator:
1. Home Loans
Home Loan is a long-term loan taken for purchasing or constructing a residential property. Home loans usually have large loan amounts and long tenure. The interest is generally based upon scheme and types of home loan i.e base rate + up to 3.50%.
Loan Tenure: Typically 10 to 30 years based on the age of the borrower.
EMI Calculation: Using our Home loan EMI Calculator, EMI can be calculated based on the loan amount, interest rate, and the tenure. The higher the duration, the smaller the EMI amounts will be, although the total interest paid in the long term will be more.
2. Auto Loans
An Auto Loan is a vehicle loan to purchase a motor vehicle, motorbike, etc. Whether purchasing a new or used vehicle or even refinance the existing auto loan, an auto loan EMI calculator can easily assist with monthly payments.
Loan Tenure: Generally 1 to 7 years.
EMI Calculation: Auto loans have slightly less interest compared to personal loans but higher compared to house loans. The EMI varies depending on the price of the vehicle and the period for which the vehicle loan is being taken and our Car loan EMI calculator easily assists in making the estimate.
3. Personal Loans
A Personal Loan is a secured loan and can be availed for any personal needs, such as education, medical emergencies, or other financial needs. Personal loan monthly emi calculator enables our customers to budget their finances efficiently.
Loan Tenure: Usually 1 to 15 years.
4. Education Loan
An Education Loan is a financial product designed for students for higher studies. It generally covers the tuition fees and living expenses of students.
Loan Tenure: Usually 1 to 15 years.
Why Choose Global IME Bank's EMI Calculator?
At Global IME Bank, we value our customers' financial well-being.
This EMI Calculator is built by experts to give 100% accurate, fast, and transparent results.
As a trusted financial institution in Nepal, we provide free tool to calculate EMI that help our customers make decisions based on real data and fair estimates.
FAQs
What is the full form of EMI?
The full form of EMI is Equated Monthly Installment.
What is EMI in a loan?
EMI is a fixed monthly payment that includes both the loan amount and interest.
How do I use the EMI calculator?
Just enter your loan amount, interest rate, and tenure. The calculator will show your EMI instantly.
Can I use this calculator for home, car, or personal loans?
Yes, you can use it for all types of loans offered by Global IME Bank.
Does EMI stay the same every month?
Yes, for fixed-rate loans, your EMI remains the same every month.
Is it better to take a short tenure or long tenure?
Short tenure means higher EMI but less interest. Long tenure means lower EMI but more total interest.
