1. What is the PMT Formula?

The PMT (Payment) formula calculates the fixed periodic payment required to pay off a loan with fixed interest rate and term. It's the standard formula used by Punjab National Bank and other financial institutions for personal loan calculations.

2. How Does the Calculator Work?

The calculator uses the PMT formula:

Where:

• \( P \) — Principal loan amount (INR)
• \( r \) — Monthly interest rate (annual rate ÷ 12)
• \( n \) — Total number of payments (term in years × 12)
• \( PMT \) — Monthly payment amount (INR)

Explanation: The formula accounts for both principal repayment and interest charges over the loan term, calculating a fixed payment that fully amortizes the loan.

3. Importance of Loan Calculation

Details: Understanding your monthly payment helps with budgeting and financial planning. It allows you to compare different loan offers and choose the most suitable option.

4. Using the Calculator

Tips: Enter the principal amount in INR, annual interest rate in percentage, and loan term in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is the typical interest rate for PNB personal loans?
A: PNB personal loan rates typically range from 10.25% to 15% per annum, depending on credit score and other factors.

Q2: Are there any processing fees?
A: PNB usually charges 0.5% to 2.5% of the loan amount as processing fee, plus applicable taxes.

Q3: What is the maximum loan amount and tenure?
A: PNB offers personal loans up to ₹20 lakh with repayment tenure up to 5 years (60 months).

Q4: Does this include insurance or other charges?
A: This calculator shows only principal and interest. Additional charges like insurance or late fees are not included.

Q5: Can I prepay my PNB personal loan?
A: Yes, PNB allows prepayment after 6 EMIs, usually with a prepayment charge of 2-5% on the outstanding amount.