1. What is EMI Calculation?

EMI (Equated Monthly Installment) calculation determines the fixed monthly payment amount for a personal loan in Bangladesh. It includes both principal and interest components, allowing borrowers to plan their finances effectively.

2. How Does the Calculator Work?

The calculator uses the standard EMI formula:

Where:

• \( P \) — Principal loan amount (BDT)
• \( R \) — Monthly interest rate (annual rate ÷ 12 ÷ 100)
• \( N \) — Number of monthly installments (loan term in years × 12)
• \( EMI \) — Equated Monthly Installment (BDT)

Explanation: The formula calculates the fixed monthly payment that pays off the loan principal and interest over the specified term.

3. Importance of EMI Calculation

Details: Accurate EMI calculation helps borrowers understand their monthly financial commitment, compare different loan offers, and plan their budget effectively for personal loans in Bangladesh.

4. Using the Calculator

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

5. Frequently Asked Questions (FAQ)

Q1: What factors affect EMI amount?
A: EMI is primarily determined by loan amount, interest rate, and loan tenure. Higher amounts, rates, or shorter terms increase EMI.

Q2: Are there any hidden charges in EMI calculation?
A: This calculator shows pure EMI. Actual loans may include processing fees, insurance, or other charges not reflected here.

Q3: Can I prepay my loan to reduce EMI?
A: Prepayment typically reduces loan tenure rather than EMI amount, unless you specifically request EMI reduction.

Q4: How does interest rate type affect EMI?
A: This calculator assumes fixed interest rates. For floating rates, EMI may change during the loan term.

Q5: What is amortization schedule?
A: It's a table showing how each payment is split between principal and interest over the loan term.