Calculate EMI for your personal loan — instant monthly EMI, total interest, prepayment savings & amortization schedule
Disclaimer: Results are estimates using the standard reducing-balance EMI formula. Actual EMI, rate, processing fee, and prepayment penalty terms vary by lender and credit profile. Default processing fee (1.5%) and prepayment penalty (2%) reflect common industry rates in India — verify with your lender before making decisions. Prepayment penalty is calculated on outstanding principal after the month's EMI but before the prepayment is applied. Monthly income needed uses 40% FOIR (Fixed Obligation to Income Ratio), the standard used by most Indian banks for personal loan eligibility. Loan-free date assumes the loan starts today. This tool does not constitute financial advice. Consult your lender or a certified financial advisor before taking a personal loan.
A personal loan is an unsecured loan — meaning the bank does not take any collateral like property or gold. Instead, the lender relies entirely on your creditworthiness: CIBIL score, income stability, debt-to-income ratio, and employer profile. Because the risk is higher for the lender, personal loan rates are significantly higher than secured loans like home loans. You repay the loan in fixed EMIs (Equated Monthly Instalments) over the chosen tenure, with each EMI covering both interest and principal.
Personal loans serve a completely different purpose from secured loans. They are used for expenses like medical emergencies, weddings, travel, home renovation, debt consolidation, or any other personal need that cannot wait. Unlike home loans (which have a 30-year tenure and tax deductions) or car loans (secured against the vehicle), personal loans must be repaid faster — typically within 5 years — at a much higher rate. The high rate and short tenure make the EMI-to-loan-amount ratio significantly higher than home loans.
This is the most frequently misunderstood aspect of personal loans. When you borrow ₹1,00,000 with a 1.5% processing fee, the bank deducts ₹1,500 upfront and credits only ₹98,500 to your account. However, your EMI is calculated on the full ₹1,00,000 — not ₹98,500. This means your effective interest rate is higher than the stated rate. On a ₹5 lakh loan with 2% processing fee and 14% rate for 3 years, the effective APR is approximately 15.4%. This calculator shows you the exact disbursed amount in the "Net disbursal" result card.
Personal loan EMIs use the same standard reducing-balance formula as all RBI-regulated bank loans:
| Variable | Meaning | How to Calculate |
|---|---|---|
| P | Principal — the amount you borrow (full amount, not net disbursal) | e.g., ₹3,00,000 |
| r | Monthly interest rate | Annual rate ÷ 12 ÷ 100 (e.g., 14% → 0.01167) |
| n | Number of monthly instalments (tenure) | Years × 12 (e.g., 3 years → 36 months) |
| EMI | Fixed monthly payment | Output of the formula — constant every month |
Given: P = ₹3,00,000 | Rate = 14% p.a. | Tenure = 3 years | Processing fee = 1.5%
Processing fee (1.5%): ₹4,500 deducted upfront — you receive ₹2,95,500. Effective APR ≈ 15.6%.
| Rate / Tenure | 1 Year EMI | 3 Year EMI | 5 Year EMI | Total Interest (3Y) |
|---|---|---|---|---|
| 10.5% | ₹26,402 | ₹9,739 | ₹6,438 | ₹50,618 |
| 12% | ₹26,641 | ₹9,964 | ₹6,672 | ₹58,704 |
| 14% | ₹26,953 | ₹10,328 | ₹6,981 | ₹71,808 |
| 18% | ₹27,580 | ₹10,850 | ₹7,614 | ₹1,00,608 |
| 24% | ₹28,545 | ₹11,815 | ₹8,645 | ₹1,45,340 |
All figures on ₹3 lakh loan. At 24% rate for 3 years, you pay ₹1.45 lakh in interest — nearly 50% of the principal. This is why getting the best rate possible matters enormously for personal loans.
Personal loans come with several charges beyond the interest rate. Understanding all of them is essential to compare lenders accurately and know your real cost.
| Charge | Typical Range | On ₹3L Loan | Notes |
|---|---|---|---|
| Processing Fee | 1%–3% of loan | ₹3,000–₹9,000 | Deducted upfront from disbursed amount. EMI charged on full loan amount. |
| GST on Processing Fee | 18% of processing fee | ₹540–₹1,620 | Added to processing fee. Total effective deduction = fee + 18% GST. |
| Prepayment Penalty | 2%–5% of outstanding | Varies by timing | Charged only if you repay early. 0% on floating-rate loans per RBI norms. |
| Penal Interest on Late EMI | 2%–3% p.m. on overdue | Varies | Charged per month on the overdue EMI amount. Avoid at all costs. |
| Documentation / Stamp Duty | ₹500–₹2,000 flat | ₹500–₹2,000 | Applicable in some states. Often waived by digital lenders. |
Lender A: 14% rate | 1% processing fee (+ 18% GST) = ₹3,540 upfront | No prepayment penalty after 12 months
Lender B: 13.5% rate | 2.5% processing fee (+ 18% GST) = ₹8,850 upfront | 4% prepayment penalty for 24 months
Not all personal loans are identical. Different lenders serve different borrower profiles at very different rates and terms:
Personal loan prepayment is powerful but the penalty makes it less straightforward than home loan prepayment. The key question is: is the interest saving greater than the prepayment penalty? This calculator answers that precisely.
Without prepayment: Remaining interest after Month 12 = ₹43,260 | Remaining EMIs = 24
With ₹50,000 prepayment at Month 12:
This calculator handles everything specific to personal loans — including processing fee disbursement math and prepayment penalty modelling. Here’s how to use each feature:
As of June 8, 2026, personal loan interest rates from major Indian lenders range from 10.5% to 24% p.a. for salaried borrowers. PSU banks (SBI, Bank of Baroda) offer the lowest rates at 10.5–13% for existing customers with CIBIL 750+. Private banks (HDFC, ICICI, Axis) offer 10.75–18%. NBFCs and fintech lenders typically charge 12–36%. Following the RBI’s 125 bps repo rate cuts through 2025 (repo now at 5.25%), most lenders have trimmed personal loan rates slightly — but the impact is smaller than on home loans since personal loans are mostly fixed-rate. The rate you receive depends primarily on your CIBIL score, monthly income, employer profile, and existing debt obligations. Always compare the APR (not just the stated rate) across at least three lenders.
Most Indian banks use the FOIR (Fixed Obligation to Income Ratio) of 40–50% of gross monthly income. Total monthly EMI obligations (all loans combined) should not exceed this threshold. A practical formula: personal loan eligibility ≈ 10–15 times your monthly net salary. For a ₹60,000 net salary, eligibility is roughly ₹6–9 lakh. This calculator shows "Monthly Income Needed" using the 40% FOIR rule on the results card. Note that existing EMIs on home loans, car loans, and credit cards all reduce your personal loan eligibility. For self-employed, banks typically require 2 years of ITR showing stable income and use the average annual income as the base for eligibility calculations.
There is no tax deduction on personal loan interest under either the old or new tax regime for most purposes. However, two specific use cases qualify: (1) if the personal loan is used for home renovation or purchase and you have documentary proof of the end use, the interest may be claimed under Section 24(b) in the old regime (up to ₹2L/year for self-occupied property); (2) if the personal loan funds are used for a business purpose (not employment income), the interest can be deducted as a business expense under PGBP in both regimes. To claim these, you must maintain proper documentation of the end use of funds. Consult a Chartered Accountant before making these claims — the burden of proof lies with you.
Most scheduled banks require a minimum CIBIL score of 700 for personal loan approval; 750+ gets the best rates. Scores between 650–700 may get approved at higher rates or with stricter conditions. Below 650, most banks will decline or require a guarantor. Fintech lenders and some NBFCs serve lower CIBIL profiles but at significantly higher rates (18–36%). The score reflects your repayment history, credit utilisation, length of credit history, and credit mix. To improve your score before applying: pay all existing EMIs on time, keep credit card utilisation below 30%, and avoid multiple loan applications in a short period (each hard inquiry drops your score by 5–10 points). A 50-point improvement in CIBIL (from 700 to 750) can reduce your personal loan rate by 1–2% — saving ₹18,000–36,000 on a ₹3L loan.
For floating-rate personal loans, RBI prohibits prepayment penalties. However, nearly all personal loans in India are on fixed rates, and lenders are permitted to charge 2–5% foreclosure penalty, typically during a lock-in period of 12–24 months. After the lock-in, many lenders allow free foreclosure. Some digital lenders (Navi, KreditBee, certain HDFC products) now advertise zero-prepayment-penalty personal loans — verify this in the loan agreement, not just the marketing material. Even when a penalty applies, if you are in the first one-third of the loan tenure, the interest saving almost always exceeds the penalty at rates of 14%+. Use this calculator to model the exact net saving.
The processing fee (1–3% of loan amount) is deducted upfront from the disbursed amount — you receive less than you borrow, but your EMI is calculated on the full borrowed amount. This makes the effective interest rate (APR) higher than the stated rate. Example: borrow ₹3L at 14% with 2% processing fee. You receive ₹2,94,000 but pay EMI on ₹3,00,000. Your stated rate is 14% but the effective APR is approximately 16.2%. The impact is larger on shorter tenures — a 2% fee on a 1-year loan raises the effective rate by ~2.5%; on a 5-year loan it raises it by only ~0.5%. This calculator shows the exact disbursed amount and breaks down the processing fee on the results card.
For personal loans, always choose the shortest tenure your cash flow comfortably supports. Unlike home loans where the tax benefit partially offsets the interest cost, personal loans have no tax deduction — so every extra rupee of interest is a pure cost. On a ₹3L loan at 14%: a 1-year tenure pays ₹23,736 in interest; a 5-year tenure pays ₹1,17,654 — nearly 5× more. The monthly EMI difference is ₹26,953 (1Y) vs ₹6,981 (5Y) — a ₹19,972 gap. If you can afford the higher EMI, the interest saving of ₹93,918 is significant. Exception: if taking a shorter tenure puts you at risk of missing EMIs (which attracts penal interest and CIBIL damage), choose the longer tenure and prepay voluntarily when cash allows.
Missing a personal loan EMI triggers three immediate consequences. First, penal interest of 2–3% per month on the overdue amount, as specified in your loan agreement. Second, the missed payment is reported to CIBIL — a single missed EMI can drop your score by 50–100 points, which can affect your ability to get future loans for years. Third, after 3 consecutive missed EMIs, the account is classified as an NPA (Non-Performing Asset) and the lender can initiate legal recovery proceedings. Unlike home loans, there is no property to auction — but lenders can pursue legal action to recover the outstanding amount. If you anticipate cash flow difficulty, contact your lender immediately — most offer EMI holiday or restructuring options that are far less damaging than missed payments.
For expenses over ₹50,000 with repayment horizon of 12+ months, a personal loan is almost always cheaper than revolving credit card debt. Credit card interest (30–45% p.a.) is significantly higher than personal loan rates (10.5–24%). However, credit cards win in two specific scenarios: (a) you can repay in full within the billing cycle (0% cost); (b) your card issuer offers a 0% EMI conversion on specific purchases (genuinely free if there are no hidden charges). For credit card balance conversion to EMI at 13–18%, a personal loan at 12% is still cheaper. Always compare the effective monthly cost. This calculator lets you run the comparison — enter the credit card interest rate and converted amount to see the true cost.
A personal loan affects your CIBIL score in several ways. Negative initially: the hard inquiry at application drops your score by 5–10 points; taking an unsecured loan increases your credit utilisation. Positive over time: consistent on-time EMI payments for 12+ months progressively improve your score; successfully closing a personal loan adds a positive entry to your credit history for 7 years. Negative if mishandled: missed or late EMIs cause significant damage (50–100 points per incident). Net impact: a well-managed personal loan with 0 missed payments over 2–3 years typically improves CIBIL by 20–50 points. The key is consistency — never miss an EMI even by a day. Set up auto-debit from your salary account on the day after salary credit.
Standard documents for a salaried applicant: Identity & address proof (Aadhaar, PAN — both mandatory); Income proof — last 3 months salary slips, last 6 months bank statements (salary account), Form 16 for the last financial year; Employment proof — offer letter or employment certificate (some lenders skip this for existing customers). For self-employed: ITR for the last 2 years, CA-certified P&L and balance sheet, business registration proof, and last 6 months current account statements. Digital lenders often require only Aadhaar, PAN, and bank statement via account aggregator (AA framework) — no physical documents. CIBIL score is pulled directly — no document required. Processing time: 2–48 hours for digital lenders, 3–5 working days for banks.
Debt consolidation — taking one personal loan to close multiple high-rate debts — makes financial sense when: (a) the new loan rate is significantly lower than the average rate of existing debts; (b) the prepayment penalties on existing loans are manageable; and (c) you will not accumulate new debt immediately after consolidating. Example: three credit card balances at 36% totalling ₹3L, consolidated into a personal loan at 14% — annual interest saving = ₹66,000. Even after a 3% processing fee (₹9,000) and any prepayment penalties, the saving is substantial. The trap to avoid: consolidating credit card debt into a personal loan and then running up the credit cards again. Use the Scenario Comparison in this calculator to model the exact saving for your specific situation before deciding.
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