1. What is the Personal Loan EMI Formula?

The Personal Loan EMI (Equated Monthly Installment) formula calculates the fixed payment amount a borrower makes each month to repay a loan. Axis Bank and other financial institutions use this standard formula to determine loan payments.

2. How Does the Calculator Work?

The calculator uses the standard EMI formula:

Where:

• \( P \) — Principal loan amount (INR)
• \( r \) — Monthly interest rate (annual rate divided by 12 and converted to decimal)
• \( n \) — Loan term in months
• \( PMT \) — Monthly payment (EMI)

Explanation: The formula accounts for both principal repayment and interest payment in each EMI, with the interest portion being higher at the beginning of the loan term.

3. Importance of EMI Calculation

Details: Calculating EMI helps borrowers understand their repayment obligations, plan their finances, and compare different loan offers before applying for an Axis Bank personal loan.

4. Using the Calculator

Tips: Enter the loan amount in INR, annual interest rate (without % sign), and loan term in months. The calculator will show your monthly EMI, total repayment amount, and total interest payable.

5. Frequently Asked Questions (FAQ)

Q1: How is Axis Bank's personal loan interest calculated?
A: Interest is calculated monthly on the reducing balance using the formula shown above.

Q2: What factors affect my EMI amount?
A: Principal amount, interest rate, and loan term are the three main factors affecting your EMI.

Q3: Can I prepay my Axis Bank personal loan?
A: Yes, Axis Bank allows prepayment, usually after a minimum period, with possible prepayment charges.

Q4: How can I reduce my EMI burden?
A: You can opt for a longer tenure or negotiate a lower interest rate to reduce your EMI.

Q5: Does this calculator show the exact EMI Axis Bank will offer?
A: This provides an estimate. The actual EMI may vary based on Axis Bank's specific terms and your credit profile.