EMI Calculator (Equated Monthly Instalment)
EMI (Equated Monthly Instalment) is the fixed amount you pay every month when repaying a loan — it includes both principal and interest. The EMI formula is a variant of the standard amortisation formula: EMI = P × r / (1 − (1+r)^−n), where P is the loan amount, r is the monthly rate, and n is the total number of months.
EMI is widely used for home loans, car loans, and personal loans. Understanding your EMI tells you exactly how much you pay each month, helping you budget effectively.
Under an illustrative assumption: borrowing 500.000.000 VND at 10%/year for 60 months (5 years) — EMI = 10.623.522 VND/month. Total payment 637.411.341 VND, of which 137.411.341 VND is interest (21.6% of total payment).
The EMI formula
Standard formula
EMI = P × r / (1 − (1 + r)^−n)
| Symbol | Meaning |
|---|---|
| P | Loan amount (500.000.000 VND) |
| r | Monthly rate = 10% ÷ 12 ÷ 100 = 0.8333% |
| n | Total months (60) |
| EMI | Monthly payment (10.623.522 VND) |
Total payment
Total = EMI × n = 10.623.522 × 60 = 637.411.341 VND
Total interest
Interest = Total − P = 637.411.341 − 500.000.000 = 137.411.341 VND
Interest as a share of total payment
21.6% — meaning for every 100 VND you pay, 21.6 VND goes to interest.
Comparison: shorter term (36 months)
EMI for 36 months: 16.133.594 VND/month → total 580.809.369 VND, interest 80.809.369 VND. Higher EMI but total interest is lower by 56.601.972 VND.
Model limitations
The formula assumes a constant rate throughout the term, monthly payments on schedule, and no early repayment. In practice: rates may be variable, and prepayment penalties may apply.
Worked example: Borrow 500.000.000, 10%/year, 60 months
| Metric | Value |
|---|---|
| Loan amount | 500.000.000 VND |
| Annual rate | 10% |
| Term | 60 months (5 years) |
| Monthly EMI | 10.623.522 VND |
| Total payment | 637.411.341 VND |
| Total interest | 137.411.341 VND |
| Interest / total | 21.6% |
Scenario comparison
| Scenario | EMI | Total interest |
|---|---|---|
| 10%/year, 60 months | 10.623.522 | 137.411.341 |
| 10%/year, 36 months | 16.133.594 | 80.809.369 |
| 7%/year, 60 months | 9.900.599 | 94.035.956 |
| 0%/year, 60 months | 8.333.333 | 0 |
Frequently asked questions
What is EMI?
EMI (Equated Monthly Instalment) is the fixed monthly payment when repaying a loan, covering both principal and interest. Example: borrow 500.000.000 VND at 10%/year for 60 months → EMI = 10.623.522 VND/month. This amount stays the same throughout the term (if the rate is fixed).
Does a longer term reduce the EMI?
Yes. A longer term → lower EMI but higher total interest. At 10%/year: 60-month EMI = 10.623.522 (total interest 137.411.341); 36-month EMI = 16.133.594 (total interest 80.809.369). Choose the term based on monthly affordability vs total cost.
How much does EMI drop if the rate decreases?
EMI is roughly proportional to the rate but not linearly. Dropping from 10% to 7% (same 60 months): EMI falls from 10.623.522 to 9.900.599 — saving 722.923 VND/month, total interest saving 43.375.385 VND.
Is EMI different from a regular installment plan?
EMI is always fixed each month (with a fixed rate). Some installment plans may separate principal and interest payments, resulting in uneven monthly amounts. EMI is more convenient because you know exactly what you pay each month.
Should I choose EMI or a 0% installment plan?
0% installment plans sound attractive but often come with conversion fees (1-3% of the value). FiMo's APR calculator shows how those fees push the effective rate higher. If an EMI at 10%/year has no fees, the APR is 10% — which may be lower than a "0%" plan with fees.
Does early repayment save interest?
Yes — early repayment reduces the remaining months → less total interest. But many banks charge a prepayment penalty (1-5% of the prepaid amount). Calculate: if interest saved > penalty fee, then prepaying makes sense.