How to Calculate EMI for a Car Loan in 2025

Buying a car is exciting, but before you sign the loan papers, you must understand your EMI (Equated Monthly Installment). Knowing your EMI helps you plan your budget, avoid surprises, and choose the best loan option.

What is Car Loan EMI?

A Car Loan EMI is the fixed monthly payment you make to the lender until your car loan is fully repaid. It includes both the principal amount and the interest charged.

Formula for Car Loan EMI

The EMI formula is the same as other loans:

EMI = [P × R × (1+R)^N] / [(1+R)^N – 1]

• P = Loan amount (Principal)
• R = Monthly interest rate (Annual Rate ÷ 12 ÷ 100)
• N = Loan tenure in months

Example Calculation

If you take a car loan of ₹8,00,000 at 9% annual interest for 5 years (60 months):

• P = 8,00,000
• R = 0.09 ÷ 12 = 0.0075
• N = 60

Your EMI will be approximately ₹16,622 per month.

Use QuickCalcEMI Car Loan Calculator

Don’t waste time on manual calculations. Use our free Car Loan EMI Calculator to get instant and accurate results by entering loan amount, interest rate, and tenure.

Tips for Managing Car Loan EMI

• Compare interest rates from banks and NBFCs before finalizing your loan.
• Make a higher down payment to reduce your EMI.
• Choose a shorter tenure if possible, this reduces total interest paid.
• Use prepayment options if you get extra funds in the future.