What is the Full Form of EMI ?

EMI - Equated Monthly Installment


Equated monthly installments are mostly calculated, when opting for a loan. It specifies the number of months you have to pay the sum of "interest and principal" each month, so that the loan is paid off completely. While repaying a loan, a lender or a borrower specifies a particular date on which installment of EMI will be given from borrower to lender.

For Example :
If you buy a house using a home loan of some money, which you need to return in the duration of 20 years (240 months). You lend this money from a bank, the installment will be paid to the bank, suppose on the 15th of every month. The EMI for the same will be calculated by combining 2 things : Principal and Loan.