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How does EMI work?

Janooji

Updated 21 September 2026

Janooji in 10 seconds

EMI (equated monthly instalment) is a fixed payment you make each month on a loan. Early EMIs are mostly interest; later EMIs repay more principal. The rate, tenure, and outstanding principal decide the amount — processing fees sit on top.

Most Indian retail loans use reducing-balance interest. That is the method in Janooji's EMI calculator. A flat-rate quote looks cheaper and is not comparable unless you convert it.

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