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The EMI full form signifies that the EMI payments are uniform monthly payments. EMI is the fixed monthly instalment you pay until your loan is fully repaid with interest. EMI Meaning: What is Equated Monthly Installment and How Does It Work? The full form of EMI is Equated Monthly Installment, which plays a significant role in personal and business finance. An Equated Monthly Instalment ( EMI ) is a fixed monthly payment that combines both principal and interest that you pay over the loan tenure. ‘Itna samjhe?’. Now, the standard EMI formula is: EMI =P×r× (1+r)N/ (1+r)N−1 . For example, you take a personal loan of ₹3,00,000 at an annual interest rate of 12% for 3 years (36 months). First, break it down: EMI stands for Equated Monthly Instalment . It refers to the fixed amount that a borrower pays every month to a lender to repay a loan. Each EMI includes both the principal component and the interest charged on the outstanding loan balance.
