Interest Rate Calculator

Some offers quote only an EMI, or a “flat” rate that hides the real cost. Working backwards from the EMI gives the true reducing-balance rate, which you can compare across lenders.

Results update as you type.

Interest rate

11.51% a year

reducing balance

Total interest
₹1,60,000
Total paid
₹6,60,000

Use this to find the real rate behind a quote given only as an EMI, or a “flat rate” offer.

About this calculator

Enter the loan amount, the EMI and the number of months.

How to use it

  1. Enter the loan amount.
  2. Enter the EMI and number of months.
  3. Read the yearly rate.

The formula

Find r such that EMI = P × r × (1 + r)n ÷ ((1 + r)n − 1)
P
loan amount
EMI
monthly instalment
n
number of EMIs

Worked example

₹5 lakh repaid as 60 EMIs of ₹11,000

  1. Total paid: ₹6,60,000; interest ₹1,60,000.
  2. The rate that fits is 11.51% a year on a reducing balance.

What the result means

A “flat” 6.4% on the same loan gives this EMI, but the real rate is 11.51%: always compare reducing-balance rates.

Assumptions

  • Interest on the reducing balance.

Limitations

  • Fees are not included; add them to the loan’s cost separately.

Frequently asked questions

How do I convert a flat rate to a real rate?

Work out the EMI from the flat rate, then enter it here. The real rate is usually almost double.

Why is my calculated rate higher than quoted?

The quote may be a flat rate, or fees may be built into the EMI.

Can the rate be zero?

Yes, if the EMIs add up exactly to the loan amount.

For information only. This calculator gives estimates based on the figures you enter and the assumptions listed above. It is not financial advice. Actual amounts depend on the lender’s or institution’s terms, fees, rounding and rate changes. Please confirm with them before you decide.

Last reviewed on 1 October 2026. Found a mistake? Tell us.