What will be your EMI on ₹10-lakh personal loan? Check calculation here | Mint

If you are taking a personal loan, all you are worried about is its repayment. It is vital to remember that a personal loan’s EMI hinges on two key factors: loan tenure and rate of interest.

These two factors determine the loan EMI in the following ways:

Rate of interest: The higher the rate of interest, the larger the loan instalment. And lower the interest, the smaller the instalment. 

Loan Tenure: Loan tenure and amount of loan are inversely proportional to each other. The longer the loan tenure, the smaller the EMI, and the shorter the loan tenure, the bigger the monthly instalment.

Now, let us suppose your loan amount is ₹10 lakh, how much would be the loan EMI on it?

Suppose the interest on personal loan is 11 per cent per annum, and you are still wondering in how many months would you be able repay it.

Consider different scenarios

Let us take five different options starting from one year to five years. The loan EMI will fall, as you would realise, with the length of loan tenure.

See the table below for details:

(Loan amount is ₹10 lakh on which bank is charging 11 per cent interest)

As we can see in the table above, the EMI is ₹88,381 when the loan is repaid in 12 months. As the tenure becomes longer to 2 years, the EMI would fall to ₹46,607. It further continues to fall as the EMI becomes longer, finally settling for ₹21,742 when the loan is repaid in five years.

Notably, you can carry out these calculations on a personal loan EMI calculator which can be accessed here.  

In the EMI calculator, you need to enter three variables: loan amount ( ₹10 lakh in this case), loan tenure and rate of interest (11 per cent in this case). As you enter all three variables, you will arrive at the monthly instalment that is payable.  

(Note: Raising a loan comes with its own risks. So, due caution is advised)