Amortisation schedule: how much of each EMI is interest

Last checked: 12 November 2026. Rates, fees and rules change; check the linked sources before you act.

The amortisation schedule is the most useful page your lender gives you, and the one people read least. It answers a simple question every month: of the EMI I just paid, how much went to the bank as interest, and how much actually reduced my loan?

What each line shows

A typical schedule has one row per instalment with five columns: the EMI number, the opening balance, the interest charged for that month, the principal repaid, and the closing balance. The closing balance of one row becomes the opening balance of the next. Interest is worked out on the opening balance at the monthly rate, and whatever is left of the EMI repays principal. That is the reducing-balance method shown on bank calculators (HDFC Bank EMI formula, checked 12 November 2026).

A full example, year by year

Take a loan of ₹60 lakh at an assumed 8.5% a year over 20 years, with an EMI of about ₹52,069. The rate is an illustration, not a current offer (Showcasia EMI calculator, checked 12 November 2026). Adding up the twelve monthly rows for selected years gives this picture:

• Year 1: about ₹5.05 lakh of interest and ₹1.19 lakh of principal; about ₹58.8 lakh still owed.
• Year 5: about ₹4.57 lakh of interest and ₹1.68 lakh of principal; about ₹52.9 lakh still owed.
• Year 10: about ₹3.69 lakh of interest and ₹2.56 lakh of principal; about ₹42 lakh still owed.
• Year 15: about ₹2.34 lakh of interest and ₹3.91 lakh of principal; about ₹25.4 lakh still owed.
• Year 20: about ₹28,000 of interest and ₹5.97 lakh of principal; the loan is cleared. Figures from the Showcasia EMI calculator, checked 12 November 2026.

In the first year, roughly four rupees of every five you pay are interest. Halfway through the loan, after ten years, you still owe about 70% of what you borrowed. In this example the principal part of the EMI only overtakes the interest part in month 143, close to the end of year 12 (Showcasia EMI calculator, checked 12 November 2026).

Why the balance falls slowly at first

Nothing about this is a trick. Interest is simply the price of the money you still hold. When you owe ₹60 lakh you pay interest on ₹60 lakh; when you owe ₹10 lakh you pay interest on ₹10 lakh. Because the EMI stays level, the shrinking interest part frees up more of each payment for principal, and the process speeds up as it goes (Showcasia EMI calculator, checked 12 November 2026).

What this means for prepayment

Any extra payment goes straight to principal, so it removes all the future interest that would have been charged on that amount. The earlier you prepay, the more months of interest you avoid. A lump sum in year two does far more than the same sum in year eighteen, when little interest is left to save.

Two choices follow a prepayment: keep the EMI and finish sooner, or keep the end date and pay a lower EMI. Keeping the EMI usually saves more interest. Test both with the prepayment calculator before you decide.

What changes the schedule

Your schedule is a projection, not a fixed promise. It changes when:

• The rate changes on a floating-rate loan, which alters the interest part from that month on.
• You prepay, which lowers the balance and either shortens the loan or cuts the EMI.
• A payment is missed or late, which can add interest and charges to the balance.
• You move to another lender through a balance transfer, which starts a new schedule.

Ask for a fresh schedule after any of these. If the remaining tenure has quietly stretched after a rate rise, you will see it here before anywhere else.

Reading your own schedule in five minutes

1. Find today's row and note the closing balance. That is roughly what you would need to close the loan.
2. Look at the interest column for the next twelve rows. That is your interest cost for the coming year at today's rate.
3. Check the final row date. If it has moved since you took the loan, ask the lender why.
4. Compare the remaining instalments with the number on your original sanction letter.

Related tools and guides

Recreate your own schedule in the EMI calculator, which shows yearly balances, and read the step-by-step EMI formula behind it. If you are still choosing a loan length, the guide on tenure versus EMI shows the cost of stretching repayments. When you are ready to look at homes, start with flats for sale in Hyderabad or flats for sale in Pune. More repayment guides are in the EMI and prepayment topic.

Questions people ask

Sources

1. Home loan EMI formula and calculator, HDFC Bank, checked 12 November 2026.
2. Reproduce the Showcasia EMI example, Showcasia, checked 12 November 2026.

This is general information, not legal, tax or financial advice. Check with a qualified professional for your case.