Save ₹— in interest · — months less
One-time prepayment of ₹— in month — reduces your tenure from — to — months. The bank keeps your EMI the same; only the months change. Net win after subtracting the prepayment from interest savings: ₹—.
Loan
Prepayment OPTIONAL
The Math
EMI formula: EMI = P · r · (1+r)ⁿ / ((1+r)ⁿ − 1)
Where P = loan amount, r = monthly rate (annual ÷ 12 ÷ 100), n = months. This is the standard reducing-balance EMI used by every Indian retail bank.
Total interest: (EMI × n) − P
Prepayment savings: we run the amortisation forward to your prepayment month, subtract your lump sum from the outstanding principal, then recompute how many months remain at the same EMI. Months saved × EMI = your gross saving; subtract the prepayment itself for net.
Frequently asked
How is the EMI calculated?
Standard reducing-balance EMI formula: EMI = P · r · (1+r)ⁿ / ((1+r)ⁿ − 1), where P is the loan amount, r is the monthly interest rate (annual rate ÷ 12 ÷ 100), and n is the loan tenure in months. This is the same formula every Indian retail bank uses.
What interest rate should I use?
Indian car loan rates in 2026 typically range from 8.5% to 11% per year for salaried borrowers with a clean credit history, and 10% to 13.5% for self-employed. Public-sector banks (SBI, BoB, Canara) tend to be at the lower end; NBFCs (Bajaj Finserv, Mahindra Finance) at the higher end. The default 9.5% is a fair midpoint.
How does the prepayment savings work?
When you make a one-time lump-sum prepayment, your bank typically reduces the outstanding principal but keeps your EMI the same — so your remaining tenure shrinks. We model exactly this: the remaining months get recomputed at the same EMI on the lower outstanding principal. The savings equal (original months − new months) × EMI − prepayment amount.
Are there prepayment penalties on car loans in India?
For floating-rate retail loans (which most car loans are), the RBI prohibits prepayment penalties on individual borrowers. Fixed-rate loans MAY have a 2-4% prepayment fee — check your sanction letter. Most major banks (SBI, HDFC, ICICI, Axis) charge zero for car loan prepayment.
What about processing fees and other charges?
This calculator shows EMI on the disbursed loan amount only. Processing fees (typically 0.5-1% of loan amount), documentation charges, and stamp duty are paid upfront and are not part of the EMI. Add them to your down-payment budget separately.
Can I share my calculation?
Yes — every input is written to the URL. Copy your address bar and the recipient sees your exact scenario.