About the Simple Interest Calculator
What is the Simple Interest Calculator?
Simple interest is interest calculated only on the original principal, never on interest already earned. It is used for many short-term loans, some personal lending, car loans quoted on a flat rate, and in school mathematics.
Enter the principal, the annual interest rate and the time in years (for example 1.5 for 18 months). The calculator returns the interest, the total amount payable or receivable and the interest earned each year.
How to use the Simple Interest Calculator
- Principal Amount (₹) (sample: 5,00,000)
- Interest Rate (% per year) (sample: 8)
- Tenure (Years) (sample: 3)
- Press Calculate Simple Interest (results also refresh as you type). The result card shows the Total Amount, along with Total Amount (Principal + Interest), Interest per Year and Principal.
Formula used
SI = P × R × T ÷ 100
- P = the principal
- R = the rate of interest per year (%)
- T = the time in years
Total amount = P + SI. For a period in months, use T = months ÷ 12; for days, T = days ÷ 365.
Worked example
These are the sample values already filled in the calculator above, and the result it returns for them:
| Input | Sample value |
|---|---|
| Principal Amount (₹) | 5,00,000 |
| Interest Rate (% per year) | 8 |
| Tenure (Years) | 3 |
| Result | Value |
|---|---|
| Simple Interest | ₹1,20,000 |
| Total Amount (Principal + Interest) | ₹6,20,000 |
| Interest per Year | ₹40,000 |
| Principal | ₹5,00,000 |
Tips for using the Simple Interest Calculator
- Compound interest always exceeds simple interest for the same rate after the first year.
- A “flat rate” loan charges simple interest on the full principal for the whole tenure, so its effective rate is almost double the quoted rate.
- To find the rate, rearrange: R = SI × 100 ÷ (P × T).