1. What is EMI?

EMI (Equated Monthly Installment) is the fixed payment amount made by a borrower to a lender at a specified date each calendar month. For HDFC Bank Sri Lanka credit cards, EMIs allow you to convert large purchases into manageable monthly payments.

2. How Does the Calculator Work?

The calculator uses the standard EMI formula:

Where:

• \( P \) — Principal loan amount (LKR)
• \( R \) — Monthly interest rate (APR/12)
• \( N \) — Loan tenure in months
• \( EMI \) — Equated monthly installment (LKR)

Explanation: The formula accounts for both principal and interest components of the loan, distributed equally over the loan tenure.

3. Importance of EMI Calculation

Details: Calculating EMI helps you plan your finances, understand the total cost of credit, and compare different loan options before making a purchase decision.

4. Using the Calculator

Tips: Enter the principal amount in LKR, annual percentage rate (APR), and loan tenure in months. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is the typical APR for HDFC credit cards in Sri Lanka?
A: APR varies but typically ranges from 18% to 36% per annum depending on card type and customer profile.

Q2: Are there any processing fees for EMI conversion?
A: HDFC Bank may charge a processing fee (usually 1-2% of principal) for converting purchases to EMI.

Q3: Can I prepay my EMI loan?
A: Yes, but prepayment charges may apply. Check with HDFC Bank for current prepayment policies.

Q4: How does EMI affect my credit limit?
A: The principal amount is blocked from your available credit limit and released as you make EMI payments.

Q5: What happens if I miss an EMI payment?
A: Late payment fees and additional interest may apply, and it could negatively impact your credit score.