Simple Interest
Interest on a principal, without compounding.
Runs entirely in your browser — nothing you enter is uploaded or sent to a server.
Simple interest is the flat method, but most real loans and deposits use reducing-balance or compounding — so the true cost or return is usually different. Use this for a quick flat-rate figure, not to judge an actual loan or investment. Read our full disclaimer.
About this tool
Simple interest is charged only on the original principal, never on interest already earned — the flat, straightforward method. The formula is SI = P × r × t ÷ 100, where P is the principal, r the annual rate, and t the time in years. Enter the three values and this tool shows the interest and the total amount separately. It's common for short-term loans, some fixed deposits, and quick back-of-the-envelope estimates.
Example
₹1,00,000 at 8% for 5 years earns ₹40,000 simple interest, for a total of ₹1,40,000.
How to use
- 1Enter the principal amount.
- 2Set the annual interest rate.
- 3Set the time period in years.
- 4Read the simple interest and total amount.
Features
- Interest and total amount appear as soon as you enter the numbers.
- Use the sliders or type each value directly.
- Principal and interest shown separately.
Frequently asked questions
How is simple interest calculated?
Simple interest = principal × rate × time ÷ 100. So ₹1,00,000 at 8% for 5 years is 100000 × 8 × 5 ÷ 100 = ₹40,000, making the total ₹1,40,000. Only the original principal earns interest.
How does simple interest differ from compound interest?
Simple interest is calculated only on the principal. Compound interest also earns interest on the interest already added, so it grows faster over time — for anything long-term, compounding makes a real difference. Use our Compound Interest tool to compare.
When is simple interest actually used?
It's typical for short-term or informal loans, some car and personal loans, and certain fixed deposits. Many real loans and savings use reducing-balance or compounding instead, so treat this as a quick flat-rate figure, not the exact cost of a specific product.
Can I use it for any currency?
Yes. The maths is the same whatever the currency — enter the principal in your own currency and the interest and total come out in the same units. The examples just happen to use rupees.
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