EMI, short for Equated Monthly Installment, refers to a fixed payment made by a borrower to a lender on a monthly basis for a loan or credit facility. It is commonly used in the context of purchasing high-value items such as homes, cars, or appliances, where the total cost is divided into smaller, manageable installments. EMI includes both the principal amount and the interest charged by the lender, allowing individuals to spread out their expenses over a specific period of time. This financial concept has become popular as it provides flexibility and affordability to consumers, enabling them to make significant purchases without bearing the burden of a lump sum payment.

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