Loan Calculator
Calculate loan monthly payments, total interest, and total repayment.
Written by Anil Gautam · Updated
What does a ₹5 lakh loan at 10% for 5 years cost?
With the starting values the monthly payment is ₹10,624, total repayment is ₹6,37,411 and total interest is ₹1,37,411. The tool spreads the loan over 60 equal payments and charges 10 ÷ 12, about 0.83%, each month on whatever is still owed. Lenders call this a reducing-balance rate.
Tenure changes the total cost more than small rate differences do. Repaid over 3 years, the same ₹5 lakh needs ₹16,134 a month and costs ₹80,809 in interest. Over 7 years the payment falls to ₹8,301 and interest rises to ₹1,97,250. Each extra year lowers the payment by less than the year before while adding more interest: going from 5 to 6 years saves ₹1,361 a month and adds ₹29,519 of interest.
Small rate differences still add up over a full term. On the same ₹5 lakh over 5 years, 11% in place of 10.5% means ₹10,871 a month against ₹10,747, about ₹124 more, and ₹7,456 more interest in total.
How does a flat interest rate compare with a reducing-balance rate?
Some lenders quote a flat rate, where interest is charged on the full amount for the whole tenure. A 10% flat rate on ₹5 lakh for 5 years means ₹2,50,000 of interest and a monthly payment of ₹12,500. Typing 10% into this calculator gives ₹10,624, because the formula assumes the balance falls with each payment.
To compare the two on equal terms, raise the rate here until the monthly payment reads ₹12,500. That happens at about 17.3%, so a 10% flat quote over five years costs roughly as much as a 17.3% reducing-balance loan.
What else changes the real cost of a loan?
Fees taken at the start raise the effective rate, because you repay the full amount while receiving less. If a ₹10,000 processing fee is deducted from the ₹5 lakh, you get ₹4,90,000 but still pay ₹10,624 for 60 months, which works out to about 10.9% a year. The calculator only sees the amount, rate and tenure you type, so add fees to your comparison separately.
The formula is the same one the EMI Calculator uses. For a year-by-year table of principal, interest and outstanding balance, use the Loan Amortization Calculator. Results are rounded to whole rupees and calculated in your browser. The ₹ sign is fixed, but the arithmetic holds for a loan in any currency.