An indicative broken period is the time gap between the disbursement of a personal loan and the time when the payment of EMI starts. Banks charge interest on the broken period which is called broken period interest. For example, the EMI of a particular personal loan has to be debited on the 5th of every month. Let’s say the loan has been disbursed on 1st of February, so on the 5th of February, you will have to pay interest of 5 days i.e. 1st to 5th February. The interest which you pay on 5th February does not include on your total outgo of the loan. Your EMI deduction will start from 5th of March onwards. In this way, the payment which you paid on the 5th of February was not considered towards loan repayment.