Are personal loans calculated on a reducing balance basis?

Usually, yes. Personal loans from reputed banks are calculated on a reducing balance method. However, some private lenders use a 'Flat Rate' method which makes the loan seem cheaper but is actually much more expensive.

What is the typical interest rate for a personal loan?

In India, personal loan interest rates typically range from 10.5% to 24% per annum depending on your CIBIL score, income, and employer category.

Personal Loan EMI Calculator

Decode the true cost of your unsecured debt. See exactly how much of your hard-earned money is going towards interest payments every month.

＋Equis / Liability Analytics

FORM AMRT · REV. 02

Loan Amount

Principal

₹

Interest Rate

Annual Rate (Reducing)

Tenure

Duration in Months

LIABILITY

Cost of Debt Ledger

Base EMI (Without GST)₹11,249/mo

Total Bank Interest+₹1,74,938

Processing Fee (w/ GST)+₹11,800

Total Repayment₹6,86,738

The Brutal Truth

Because of GST on interest and processing fees, your 12.5% loan is actually costing you roughly:

~7.47% Effective Annual Rate

Base EMI₹11,249

Total Repayment₹6,86,738