EMI (Equated Monthly Instalment)

Also known as: equated monthly instalment, loan emi

An EMI is the fixed amount you pay each month to repay a loan over its tenure. Inside each EMI, early payments are mostly interest and late ones mostly principal — so you barely reduce what you owe in the early years. This is why early prepayments save so much, and why a longer tenure lowers the EMI but sharply raises total interest.