When you apply for a personal loan, most people first worry about the EMI (Equated Monthly Installment). EMI determines how manageable your monthly repayments will be. Even small changes in loan terms can significantly alter your EMI.
At 24hrLoan, we work with many banks and lenders. Knowing these factors empowers you to choose the best loan offer with an affordable EMI. Here are the 5 key factors that influence your personal loan EMI, explained simply.
1. Loan Amount – Higher Loan, Higher EMI
The loan amount you borrow directly affects your EMI.
- If you take a higher loan amount, your EMI will increase.
- If you borrow only what you need, your EMI stays manageable.
Example:
- Loan of ₹2 lakh → Lower EMI
- Loan of ₹5 lakh → Higher EMI
👉 Tip from 24hrLoan:
Borrow only the amount required. Since 24hrLoan offers loans from multiple banks, you can compare EMI options before finalizing.
2. Interest Rate – The Biggest EMI Decider
The interest rate is the most critical factor influencing your EMI.
- Lower interest rate = Lower EMI
- Higher interest rate = Higher EMI
Even a 1–2% difference in interest rate can change your EMI noticeably over time.
Why does the interest rate vary?
- Your CIBIL score
- Your income stability
- Lender policies
- Loan tenure
👉 24hrLoan Tips:
We compare offers from multiple banks and NBFCs, helping you find loans with competitive interest rates, reducing your EMI burden.
3. Loan Tenure – Longer Tenure, Lower EMI
Loan tenure is the period over which you repay the loan.
- Short tenure → High EMI but lower total interest
- Long tenure → Lower EMI but higher total interest paid
Example:
- 2-year tenure → EMI is higher
- 5-year tenure → EMI is lower
👉 24hrLoan Tip:
Choose a tenure that balances comfortable EMI and reasonable interest cost.
4. Credit Score (CIBIL Score) – Your Financial Reputation
Your credit score plays a huge role in deciding your EMI.
- High CIBIL score (750+)
- Lower interest rates
- Lower EMI
- Low CIBIL score
- Higher interest rates
- Higher EMI or even rejection
Banks see a good credit score as a sign of responsible borrowing.
👉 24hrLoan Tips:
Even if your credit score is average, we help you find lenders who are more flexible, improving your chances of approval.
Also Read: Jio Finance Loan Apply Online
5. Processing Fees & Other Charges
Many borrowers forget that processing fees also affect the overall loan cost.
- Processing fees are usually 1%–3% of the loan amount.
- Some lenders add insurance or documentation charges.
Though these charges don’t directly increase EMI, they increase the total loan cost, which impacts your financial planning.
👉 24hrLoan Tips:
We clearly display our charges so you know exactly what you’re paying—no hidden charges. So, you know exactly what you’re paying.
Bonus Factor: Your Income & Job Stability
While not directly part of the EMI calculation, your monthly income and job stability influence:
- Loan approval
- Interest rate offered
- EMI affordability
Higher income = better loan terms = lower EMI stress.
How to Reduce Your Personal Loan EMI?
Here are some smart ways to keep EMI low:
- Improve your credit score.
- Compare offers from multiple lenders.
- Choose the right loan tenure.
- Avoid unnecessary loan amounts.
- Check total cost, not just EMI.
With 24hrLoan, you can compare all this in one place.
Why Choose 24hrLoan for Personal Loans?
24hrLoan helps you:
- Compare loans from multiple banks & NBFCs
- Get better interest rates.
- Choose EMI-friendly loan options.
- Apply online with minimal paperwork.
- Save time and money
Also Read: Top 5 Credit Cards for Low CIBIL Score in India
Conclusion
Your personal loan EMI is not decided randomly. It depends on the loan amount, interest rate, tenure, credit score, and charges. Understanding these 5 factors helps you make smarter borrowing decisions and avoid financial stress.
With 24hrLoan, you don’t have to settle for one lender—you can choose the best personal loan with the most comfortable EMI.