The credit market in India is steadily on the rise. It is currently the 4th largest credit industry in the world, recording a CAGR of over 11% year on year. A vast majority of these advances are short-term credits such as personal loans and credit cards. Combined, these two financial products account for 78% of all credit lending in India. Loan repayments include EMIs and borrowers should consider the EMI amount to accurately plan their current and future finances.

There are several EMI calculators available online; one must choose an accurate EMI calculator and learn its usage to calculate the exact EMI amount they are liable to pay for a loan.

The formula to determine loan EMI amount

There is a specific formula that Groww uses to compute the EMI amount for a loan.

EMI = [P x R x (1+R) ^N]/ [(1+R) ^ (N-1)], where –

• P is the principal amount
• R is the rate of interest
• N is the loan tenure

Advantages of using EMI calculator

• It is entirely free of charge. Anyone can use it at any time, as many times as they want.
• Our loan calculator online is 100% accurate every time.
• It's fast and provides an accurate estimate instantaneously.

Apart from the loan EMI calculator, Groww also offers other calculators as you can see below. All of them are free to use and you can use them as many times as you want.

How can an online EMI calculator help you?

The number of credit accounts is growing at an even higher CAGR of 28% and has reached 107 million accounts at the end of FY18.

Regardless of the type of loan you want to avail of, be it a secured or unsecured advance, it is paramount that you know how much monthly instalment you have to make before you avail it. That is where an EMI calculator in India can be immensely helpful.

• It helps you get an accurate estimate of your EMI amount so that you can plan your finances accordingly. Make sure that your debt-to-income ratio is below 50% to maximize your chances of loan approval.
• A loan EMI calculator helps you save valuable time. You don’t have to do complex calculations manually, which can be quite time-consuming.
• It eliminates any chance of a miscalculation, providing you with an accurate estimate every time.
• It is highly specific for each type of loan. The EMI breakup of a home loan, for example, is different from that of a personal loan.