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Moratorium Interest Impact Calculator

What an interest-only holiday actually costs. Unpaid moratorium interest is added to the loan, so repayment starts on a larger balance than the amount that was disbursed.

Also called: emi holiday calculator, loan moratorium cost, education loan moratorium.

₹

Type "50 lakh", "1.2 crore" or "250k", all of them parse.

%
years
Payment frequency

Paying quarterly or yearly instead of monthly changes the interest, not just the instalment.

Fewer, larger instalments means the balance sits higher for longer, so total interest rises even though each payment covers more principal.

Prepayments and extra payments

A lump sum, a standing extra amount, or both. The schedule and the saving are recomputed against them.

₹

A standing amount on top of the instalment. This is what a "round up my EMI" plan does.

₹

Leave at 0 if you are not making a lump-sum prepayment.

Fees and ongoing charges

Processing fees raise your effective rate; insurance and maintenance raise your real monthly outgo.

₹

Deducted from what you receive but charged on the full loan, so they raise your APR without changing the instalment.

₹

Not part of the loan, but part of what leaves your account each month.

Interest-only period before repayment

Months before repayment starts, and whether the interest accruing in them is capitalised. The same arithmetic covers a study-period holiday, a deferment and a payment pause.

If you do not, it is added to the loan, which is why an education loan is often larger when repayment begins than the amount that was disbursed.

Monthly instalment
₹21,494

₹21,494 a month for 5 years. Over the full term you repay ₹12,89,634, of which ₹2,89,634 is interest. 28.96% of what you borrowed.

Total interest
₹2,89,634
Total repayment
₹12,89,634
Interest as % of principal
28.96%
Interest in period 1
₹8,750
Principal in period 1
₹12,744
How this is calculated

An estimate, not an offer or a guarantee. Projected returns assume the rate you entered holds for the whole term, which no market does.

Where your money goes

Total₹12.9 lakh
Principal ₹10,00,000 (78%)Interest ₹2,89,634 (22%)

Outstanding balance

Hover or drag for values
₹0₹2.47 lakh₹4.94 lakh₹7.4 lakh₹9.87 lakhMonth 1Month 60
Outstanding balance
60 rows
MonthPaymentInterestPrincipalBalance
1₹21,494₹8,750₹12,744₹9,87,256
2₹21,494₹8,638₹12,855₹9,74,401
3₹21,494₹8,526₹12,968₹9,61,433
4₹21,494₹8,413₹13,081₹9,48,351
5₹21,494₹8,298₹13,196₹9,35,156
6₹21,494₹8,183₹13,311₹9,21,844
7₹21,494₹8,066₹13,428₹9,08,417
8₹21,494₹7,949₹13,545₹8,94,871
9₹21,494₹7,830₹13,664₹8,81,208
10₹21,494₹7,711₹13,783₹8,67,424
11₹21,494₹7,590₹13,904₹8,53,520
12₹21,494₹7,468₹14,026₹8,39,495
Method and background

This is what the calculation gives for the numbers you entered. It is an estimate, not advice, and it knows nothing about your situation beyond those numbers. Rules for India change on a published schedule; the effective date is shown on every rule-based tool.

How this is calculated

During a moratorium no principal is repaid, but interest still accrues. If you do not pay it as it accrues it is capitalised (added to the loan) and every later instalment amortises the larger balance. That is why an education loan is routinely bigger when repayment begins than the amount that was borrowed, and it is the part borrowers are most often surprised by.

E = P * i * (1+i)^n / ((1+i)^n - 1)
E
The equal periodic instalment (currency)
P
Principal: the amount borrowed (currency)
i
Monthly interest rate = annual rate ÷ 12 ÷ 100 (decimal)
n
Total number of monthly instalments (months)

Worked examples

Each of these is asserted on every build. If a change to the engine ever moved one of these answers, the build would fail before the page could print it.

24 months of capitalised interest on a 20L education loan

Loan amount
₹20,00,000
Interest rate (per year)
10.5%
Tenure
10 years
Instalment frequency
Monthly
Interest-only months before repayment starts
24

Monthly instalment₹33,263

2,000,000 x (1 + 0.105/12)^24 = 2,465,103.40

Open this example

paying the interest during the moratorium keeps the balance flat

Loan amount
₹20,00,000
Interest rate (per year)
10.5%
Tenure
10 years
Instalment frequency
Monthly
Interest-only months before repayment starts
24
I will pay the interest during that period
Yes

Monthly instalment₹26,987

boundary: interest paid as it accrues is never capitalised

Open this example

no moratorium is the ordinary loan

Loan amount
₹20,00,000
Interest rate (per year)
10.5%
Tenure
10 years
Instalment frequency
Monthly

Monthly instalment₹26,987

degenerate case: with the section empty this equals PMT(10.5%/12, 120, -2000000)

Open this example

Method and limits

What it assumes

  • Interest compounds monthly on the reducing balance.
  • The rate stays fixed for the whole term. Floating-rate loans reset periodically.
  • Processing fees, insurance and statutory charges are excluded.

What it deliberately does not model

  • Does not model rate resets on floating-rate loans. Most lenders hold the instalment steady and extend the term instead, so a rate rise can add years without changing what leaves your account each month.
  • Does not include property insurance, maintenance or association dues, or any lender fee.
  • Assumes every instalment is paid in full and on time.
  • Assumes the moratorium runs from disbursement. A mid-term holiday granted on an existing loan starts from the balance at that point instead.

Formula version 1.0.0 · definition 1.0.0 · India · Report a problem with this calculator

Frequently asked questions

Why is my bank's EMI a few rupees different from mine?
Rounding. Lenders round the instalment and true up the final payment against the residual balance, which is why the last month of a schedule looks lopsided. A difference of one or two is normal; a difference of hundreds means a different rate, tenure or fee assumption.
Why is my EMI almost all interest in the early years?
Interest in any month is the rate times the previous balance, and the balance starts at its maximum. On a 20-year loan at 8.5% the first year is about 81% interest. The only way to change the shape of that is to attack the balance early, which is what prepayment does.