Calculate simple interest on your investments or loans quickly.
Simple Interest = (Principal × Rate × Time) / 100
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Simple Interest is the easiest way to calculate interest charge on a loan. It is determined by multiplying the daily interest rate by the principal by the number of days that elapse between payments.
SI = (P * R * T) / 100
Where P = Principal, R = Rate per annum, T = Time in years.
Enter the principal amount, annual interest rate, and time period. The calculator shows the simple interest earned or payable, along with the total amount at the end of the period.
Simple interest is useful when interest is charged only on the original principal and does not compound. This makes it easier to understand than compound interest, but it is less common in long-term investment products.
Simple Interest = (Principal x Rate x Time) / 100
Total amount is:
Total Amount = Principal + Simple Interest
For example, if you invest ₹1,00,000 at 8% simple interest for 3 years:
SI = 1,00,000 x 8 x 3 / 100 = ₹24,000
The total amount will be:
₹1,00,000 + ₹24,000 = ₹1,24,000
| Feature | Simple Interest | Compound Interest |
|---|---|---|
| Interest base | Original principal only | Principal plus accumulated interest |
| Growth | Straight-line | Accelerating |
| Calculation | Easier | More powerful over time |
| Best for | Short-term loans or basic interest estimates | Long-term investments |
If you are planning long-term savings, compound interest is usually more relevant. If you are checking a short-term loan, delayed payment, or basic interest charge, simple interest may be enough.
Simple interest may be used in some personal loans, short-term lending, informal borrowing, invoice delays, late payment charges, and educational examples. It is also useful for quickly estimating the cost of borrowing before looking at more detailed EMI schedules.
Simple interest is interest calculated only on the original principal amount.
Simple interest does not reinvest earned interest. The calculation base remains the original principal for the full tenure.
For borrowers, simple interest is usually cheaper. For investors, compound interest usually creates more wealth over time.
Most cumulative FDs use compound interest, so an FD calculator is more accurate.
Convert the time period into years. For example, 6 months is 0.5 years.
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