Loan Amortisation

Wondering what is loan amortisation? 

It refers to a repayment schedule where you, as a borrower, make regular payments towards your loan, covering both a portion of the accrued interest and the principal amount you owe. In an amortised loan, a larger part of your repayment instalment goes towards interest payment and a smaller portion of the amount counts towards principal repayment during the initial repayment tenure. 

Home loans, car loans, bike loans and personal loans are common loan amortisation examples as you repay these credit facilities in EMIs that consist of both the interest and the principal.