How is the EMI & Interest calculated in case of a monthly reducing balance scheme?

The bank charges annual interest rate according to monthly reducing balance. In monthly reducing cycle, the principal is reduced with every EMI and the interest is calculated on outstanding balance.

Example and Calculations:

  • The Bank charges annual interest rates (as shown below) according to the reducing monthly balance. In the monthly reducing cycle, the principal is reduced with every EMI and the interest is calculated on the outstanding balance.
  • NO processing fee is charged for availing HomeShop18’s EMI payment option. In case of any kind of refund in an EMI transaction, interest already billed in a particular transaction will not be refundable under any circumstances.
  • The table below shows a representative rendering of EMI plans for a Rs. 10,000 purchase using the EMI payment plan. 

 

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Above charges are exclusive of service tax

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