Loan Interest Calculator UAE

Name: Loan Interest Calculator UAE
Author: CalculatorBolt

Calculate loan interest and EMI (Equated Monthly Installment) in the UAE. Enter loan amount in AED, annual interest rate, and loan term. Get total interest payable and monthly payment using reducing balance or flat rate methods. Informational only—verify with a UAE bank. Explore more tools on free calculators on CalculatorBolt.

Calculator

Loan Amount (AED)

Principal amount borrowed

Annual Interest Rate (%)

Annual percentage rate

Loan Term

Years

Months

Loan duration

Interest Calculation Type

Method used by bank

Monthly EMI

Total Interest

Total Payment

Calculation Summary

Import JSON

How it works

Reducing Balance: EMI = P × [r(1+r)^t] / [(1+r)^t-1] / 12, where P is principal, r is monthly interest rate, and t is total months. Interest is calculated on the outstanding balance each month.

Flat Rate: Total Interest = P × Annual Rate × (Term in Years). The total amount is divided equally across all months. This method is simpler but typically results in higher effective interest.

Inputs explained

Loan Amount (AED): The principal amount you wish to borrow.
Annual Interest Rate (%): The yearly interest rate offered by the bank.
Loan Term: Duration of the loan in years or months.
Interest Calculation Type: Reducing Balance (most common in UAE) or Flat Rate (simple interest).

Example

Loan Amount = 100,000 AED, Interest Rate = 5% per annum, Term = 5 years, Type = Reducing Balance

→ Monthly EMI ≈ 1,887 AED
→ Total Interest ≈ 13,220 AED
→ Total Payment ≈ 113,220 AED

Tips & notes

Reducing balance (amortizing) is the most common method for personal and car loans in the UAE.
Flat rate loans may appear to have lower rates, but the effective annual rate is typically higher.
Always check for processing fees (1–2% of loan amount), life insurance premiums, and early settlement charges.
UAE banks typically require a minimum salary and may have debt-burden ratio limits (typically 50% of gross salary).
For mortgages, UAE banks usually finance up to 80% of property value for UAE nationals and 75% for expats.
Compare offers from multiple banks to get the best interest rate.

UAE Loan Types & Typical Rates

Loan Type	Typical Rate	Max Tenure
Personal Loan	4–8%	4–5 years
Car Loan	3–6%	5 years
Home Loan (Mortgage)	3.5–5%	20–25 years
Credit Card	2.5–3% per month	—

FAQs

Rates vary by bank and customer profile, typically 4–8% per annum on reducing balance for personal loans in the UAE.

Most UAE banks use the reducing balance (amortizing) method for EMI calculation, where interest is calculated on the outstanding principal.

This calculator uses standard interest models. For Islamic finance products like Murabaha or Ijarah, consult your bank for specific terms.

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Reducing balance calculates interest on the outstanding loan amount, while flat rate calculates interest on the original principal throughout the loan term. Reducing balance typically results in lower total interest.

Yes, UAE banks typically charge processing fees (1–2% of loan amount), life insurance, and early settlement fees. Check with your bank for details.

Yes, expats can get loans in the UAE. Requirements typically include a minimum salary, employment letter, and valid residency visa.

Personal loans: up to 5 years; Car loans: up to 5 years; Home loans (mortgages): up to 25 years, depending on the bank and borrower's age.

Disclaimer

Informational estimate only. Does not account for processing fees, life insurance premiums, or specific UAE bank terms. Consult a UAE bank for official loan quotations and details.