Find the monthly installment (EMI) for a car, bike or personal loan, with total interest.
🛠️ Free tool by the NayaPakistan team · Updated September 2026
Banks and leasing companies in Pakistan calculate loans on the reducing-balance method: each month's markup is charged only on the outstanding principal, so early installments are mostly interest and later ones mostly principal. The EMI formula turns your loan amount, markup rate and tenure into one fixed monthly amount that clears the loan by the end of the term.
Two things make a real difference to what you pay. A shorter tenure raises the monthly installment but sharply cuts the total interest. And comparing offers by total repayment (installment × months) is more honest than comparing advertised rates, because processing fees, insurance and different tenures hide the true cost.
Lenders use the reducing-balance EMI formula: EMI = P × r × (1+r)ⁿ ÷ ((1+r)ⁿ − 1), where P is the loan, r is the monthly markup rate and n is the number of months. The result is one fixed monthly payment.
EMI stands for Equated Monthly Installment — the fixed amount you pay every month, combining markup and principal, until the loan is fully repaid.
Yes. A shorter tenure means a higher monthly installment but much less total interest, because the principal is cleared faster. Use the calculator to compare terms side by side.
The monthly amount is worked out the same way, but Islamic auto financing uses rent/profit instead of interest and different terms. Use this as an estimate and confirm the exact schedule with the bank.