Simple Interest Calculator
Work out simple interest and the total amount on any principal over time.
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Frequently asked questions
What is simple interest?
Simple interest is calculated only on the original principal, not on any interest already earned. It is common for short-term loans and some deposits.
What is the simple interest formula?
Simple Interest = (P × R × T) / 100, where P is the principal, R is the annual rate of interest, and T is the time in years. The total amount is principal plus interest.
How is it different from compound interest?
Simple interest is charged only on the principal, so it grows in a straight line. Compound interest is charged on principal plus accumulated interest, so it grows faster over time.
When is simple interest used?
It is often used for car and personal loans, short-term borrowing, and some fixed deposits where interest is not reinvested.