What is EMI in a Personal Loan?
EMI (Equated Monthly Installment) is the fixed amount you repay to the bank or lender every month until your loan is cleared. It includes both:
- Principal – the actual loan amount you borrowed.
- Interest – the cost charged by the lender for giving you the loan.
The formula used to calculate EMI is: EMI=P×R×(1+R)N(1+R)N−1EMI = \frac{P \times R \times (1+R)^N}{(1+R)^N – 1}EMI=(1+R)N−1P×R×(1+R)N
Where:
- P = Principal loan amount
- R = Monthly interest rate (Annual Rate ÷ 12 ÷ 100)
- N = Loan tenure in months
EMI for a ₹9 Lakh Personal Loan for 3 Years
When you borrow ₹9,00,000 for a tenure of 36 months (3 years), your EMI will depend on the interest rate offered by the lender.
Here’s an estimated EMI chart:
| Interest Rate (per annum) | EMI (approx.) | Total Interest Payable | Total Repayment Amount |
|---|---|---|---|
| 10% | ₹29,040 | ₹4,45,440 | ₹13,45,440 |
| 12% | ₹29,970 | ₹5,78,920 | ₹14,78,920 |
| 14% | ₹30,900 | ₹7,24,400 | ₹16,24,400 |
| 16% | ₹31,830 | ₹8,81,880 | ₹17,81,880 |
As you can see, a small difference in interest rates can change your EMI significantly.
Factors That Affect Your EMI
Several factors decide how much EMI you will pay on your ₹9 lakh loan for 3 years:
- Interest Rate – Lower rates reduce your EMI. Compare lenders before applying.
- Loan Tenure – A longer tenure means smaller EMIs but higher total interest.
- Credit Score – A good score (750+) increases your chances of getting low interest rates.
- Lender Policies – Different banks and NBFCs have different eligibility criteria and processing charges.
How to Reduce EMI on a ₹9 Lakh Loan?
- Maintain a good credit score to negotiate better rates.
- Choose a longer tenure if you want lower monthly payments.
- Compare lenders online before finalizing a loan.
- Make part-prepayments whenever possible to reduce principal and interest burden.
Benefits of Taking a Personal Loan
- No collateral required – unsecured loan.
- Quick approval & disbursal – often within 24–48 hours.
- Flexible usage – spend on any personal need.
- Prepayment option – pay off early to save interest.
FAQs
Q1. What will be the EMI for a ₹9 lakh loan for 3 years at 12% interest?
A: The EMI will be around ₹29,970 per month.
Q2. Can I reduce my EMI after taking the loan?
A: Yes, by refinancing with another lender at a lower interest rate or by making prepayments.
Q3. Is a 3-year tenure better than a 5-year tenure?
A: A 3-year tenure has higher EMIs but saves a lot on interest compared to 5 years.
Q4. What is the minimum CIBIL score required for a ₹9 lakh personal loan?
A: Generally, 700–750+ is preferred by most banks and NBFCs.
Disclaimer: This article is for general information only. The interest rates and terms mentioned in it depend on the policies of the bank and NBFC. These may change from time to time. Before taking any type of loan, get complete information from your bank.