1. What is EMI?

EMI (Equated Monthly Installment) is the fixed payment amount a borrower pays to a lender each month until the loan is paid off. It includes both principal and interest components.

2. How Does the EMI Calculator Work?

The calculator uses the standard EMI formula:

Where:

• \( P \) — Principal loan amount (₹)
• \( R \) — Monthly interest rate (annual rate divided by 12, in decimal)
• \( N \) — Loan tenure in months

Explanation: The formula calculates the fixed monthly payment that would pay off the loan with interest over the specified term.

3. Understanding Loan Components

Principal: The original loan amount borrowed.
Interest Rate: The cost of borrowing, expressed as an annual percentage.
Tenure: The repayment period in months.
Total Payment: Sum of all EMIs over the loan term.
Total Interest: The extra amount paid over the principal.

4. Using the Calculator

Tips: Enter the principal amount in ₹, annual interest rate in percentage, and loan tenure in months. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is ICICI Bank's current personal loan interest rate?
A: ICICI Bank personal loan rates typically range from 10.5% to 19% p.a., depending on credit profile and other factors.

Q2: How can I reduce my EMI amount?
A: You can reduce EMI by either negotiating a lower interest rate or opting for a longer tenure (though this increases total interest paid).

Q3: Does this calculator account for processing fees?
A: No, this calculates only the EMI. Remember to account for processing fees (typically 1-3% of loan amount) in your total cost.

Q4: Can I prepay my ICICI personal loan?
A: Yes, ICICI allows prepayment after 12 EMIs, usually with a prepayment charge of 2-5% of the principal outstanding.

Q5: How does EMI change with floating rates?
A: For floating rate loans, EMI may change when interest rates are revised by the bank.