EMI and Tenure are two important factors in deciding a loan. Whether you want to pay a high EMI for a short tenure or a low EMI for a longer tenure? That is an important decision to make. 

Now, once you have taken the loan and have started making EMI payments, your financial situation may change. You may get promotions and salary increases and be in a better position to pay off the loan. Adversely, you may take more loans and struggle to manage all the repayments at a time. 

How do you decide whether to reduce your EMI or reduce loan tenure?

Both options have their own pros and cons. 

Reducing the EMI will give you a better breathing space to manage your other debts. However, it will increase the overall interest burden on your loan. You will end up paying a huge interest amount on your loan amount. 

Meanwhile, reducing your tenure will allow you to pay off the loan earlier than originally planned. This will also give you considerable savings on the interest part. However, your monthly EMI amount may increase. This may put some additional pressure on your cash flow. 

So, it is important to balance between these two to have a comfortable repayment schedule for your loan. 


If you feel that your EMI is high, you may opt for loan restructuring with the bank. 

You can also think of a loan balance transfer to another bank to get better rates on your existing loan.