Meaning
The loan tenor is a fundamental aspect of any financial borrowing, determining the duration of repayment.
Definition
Tenor (Loan) refers to the total period or duration over which a borrower is expected to repay a loan, including both the principal amount and accrued interest.
Key Characteristics
It is typically expressed in months or years. A longer tenor usually results in lower Equated Monthly Installments (EMIs).
Impact on Loan Dynamics
The loan tenor directly influences the EMI amount and the total interest paid over the life of the loan. A longer tenor means smaller EMIs but generally higher total interest.
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