1. What is EMI?

EMI (Equated Monthly Installment) is a fixed payment amount made by a borrower to a lender at a specified date each calendar month. It's used to pay off both principal and interest each month, so the loan is paid off in full over the tenure.

2. How Does EMI Calculation Work?

The calculator uses the standard EMI formula:

Where:

• \( P \) — Principal loan amount (Rs)
• \( R \) — 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 period.

3. Importance of EMI Calculation

Details: Understanding your EMI helps in financial planning, comparing loan offers, and ensuring the payments fit within your monthly budget before committing to a loan.

4. Using the Calculator

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

5. Frequently Asked Questions (FAQ)

Q1: What is the benefit of converting credit card purchases to EMI?
A: It allows you to pay for large purchases in manageable monthly installments rather than one lump sum.

Q2: How does SBI credit card EMI conversion work?
A: Eligible purchases can be converted to EMI through the SBI Card app/website, with interest rates based on the product and tenure chosen.

Q3: Are there any charges for EMI conversion?
A: SBI may charge processing fees for EMI conversion, which would be added to the principal amount.

Q4: Can I prepay my EMI loan?
A: Yes, but prepayment charges may apply depending on the terms of your EMI conversion.

Q5: How is interest calculated in EMI?
A: Interest is calculated monthly on the reducing balance, with more interest paid in initial EMIs and more principal in later EMIs.