An Equated monthly installments (EMI) is a fixed payment amount made by a borrower to a lender at a specified date for each calendar month. EMI are used to pay off both interest and principal each month, so that over a specified number of years, the loan is paid off in full.
The mathematical formula above indicates how EMI is manually calculated where:
- EMI = Equated Monthly Installment
- P = Principal
- R = Interest Rate
- N = Loan Period
Using Excel in calculating EMI
Below is the procedure on how to do EMI calculation in Microsoft Excel
