Amortisation Schedule
Also called: loan schedule, repayment schedule
What is Amortisation Schedule?
An amortisation schedule lists every instalment of a loan with the split between interest and principal and the balance remaining after each payment. It shows exactly how a loan unwinds over its tenure.
Why Amortisation Schedule matters
The schedule reveals what the EMI hides: most early payments are interest. It is also what tells you the real saving from prepaying in month twelve rather than month forty.
Amortisation Schedule formula
Closing balance = Opening balance + Interest for the period − EMI paid
Repeat monthly until the balance reaches zero.
How Amortisation Schedule works in practice
Get the schedule at sanction and keep it with the loan file. Use it to book interest correctly in the books, since only the interest portion is an expense.
Frequently asked questions
Early instalments are mostly interest. The principal portion grows steadily as the balance falls.