The full form of EMI is Equated Monthly Installment. It is a fixed amount of money that a borrower pays back to a moneylender within a specific time period which can be paid monthly. The amount is to be paid in both principal component and interest component which a borrower has to pay off to the lender in full within a specific number of years. However, it is an unequal combination of principal rate and interest rate. If you want to take a loan from a bank then first you need to understand how the bank is offering the EMI so that you could know about various loan options of different banks and then can choose one according to your financial constraints. The calculation of EMI depends on the following factors –
• Interest Rate – the rate of interest is mainly charged by the moneylender.
• Loan Amount ( Principal Loan ) – it is the actual amount borrowed.
• Tenure of the Loan – it is the time period provided by the money lender to the borrower to repay the entire loan amount including the interest.
The advantages of EMI are –
• Power to buy
• Flexibility
• No middleman
• Protects Savings.
EMI is Equated Monthly Installment. To repay the money taken as a loan from EMI Bank or any Financial Institution, the bank gives you the facility to repay the loan amount in installments. For this, an amount is fixed for you by the bank and a period is also for completing that amount.
EMI is known as equated monthly installment. EMI is the amount which is borrower pays back in the form of a monthly installment within a specific period. However, it is an unequal combination of interest rate and principal. So, for example, if you want to take any kind of loan for your need, you need to know how much interest and principal the bank is charging from you.
EMI is very useful as we can pay the loan in a small amount every month. The amount of EMI completely depends on the loan amount, interest, and tenure. EMI is very much flexible, it depends on the borrower in how much period will be required to pay the loan, accordingly, the EMI is decided.
EMI facility is available whenever you buy vehicles, electrical appliances, houses, etc. The duration period for paying EMI can vary from upto one year to three years and so on. EMI is very much easier as you pay money in installments rather than paying at the time of purchase.
| Term | Full Form |
| EMI | Equated Monthly Installment |
FAQ’s
The full form of EMI is Equated Monthly Installment. It is a fixed amount of money which a borrower pays back to a money lender within a specific time period which can be paid monthly.
EMI is short form of Equated Monthly Installment.
Equated Monthly Installment is full form of EMI.
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