EMI Calculator (NPR) — Monthly Loan Payment

An Equated Monthly Instalment (EMI) is the same payment every month until the loan is repaid. Each EMI covers that month’s interest on the outstanding balance, and the rest reduces the principal. Because the balance is highest at the start, early EMIs are mostly interest; as the balance falls, more of each EMI goes to principal.

The calculator converts your annual rate to a monthly rate (annual rate ÷ 12 ÷ 100) and your tenure to months (years × 12), then applies EMI = P × r × (1 + r)^n ÷ ((1 + r)^n − 1). It shows the number of months, the monthly rate, the EMI, total interest and total payable, followed by a year-by-year repayment schedule of principal repaid, interest paid and the balance left at the end of each year. For a month-by-month schedule, ask your bank.

Example: NPR 25,00,000 at 10% for 10 years. The monthly rate is 0.8333% over 120 months, giving an EMI of NPR 33,037.68. Total payable is NPR 39,64,522.11, of which NPR 14,64,522.11 is interest. In the first month, interest is NPR 20,833.33 (25,00,000 × 10 ÷ 1,200), so only about NPR 12,204 of that first EMI reduces the principal.

On the 20-year home loan, the interest alone is about 1.4 times the amount borrowed, so you repay roughly 2.4 times the principal in total. Personal loans are unsecured and usually carry a higher rate than home or vehicle loans, which is why a much smaller loan still costs close to NPR 2 lakh in interest over five years.

Half a percentage point matters: moving from 10% to 10.5% on this loan adds about NPR 1,334 a month and about NPR 3.2 lakh of interest over 20 years. That is worth negotiating before you sign.

Tenure works the other way. Stretching from 20 to 25 years cuts the EMI by only about NPR 2,253 but adds about NPR 16.4 lakh of interest. Choosing 10 years instead of 20 raises the EMI by about NPR 14,259 but saves about NPR 29.2 lakh. Pick the shortest tenure whose EMI you can pay comfortably every month.

• Floating rates: most loans in Nepal are priced as the bank’s base rate plus a premium. When the base rate moves, the bank revises either your EMI or your remaining tenure, so ask which one your loan uses.
• Upfront charges: service or processing fee, valuation fee for property and vehicle loans, and legal or mortgage registration costs for property loans. Get the full list in writing.
• Insurance: lenders commonly require insurance on the property or vehicle, and sometimes life cover on the borrower.
• Tenure limits: the maximum tenure depends on the product and is often capped by your age at the end of the loan, so younger borrowers may be offered longer terms.
• Prepayment terms: charges for paying early vary by bank and loan type. Check the clause before you sign if you expect a bonus or land sale that you would use to cut the loan.