Simple Interest Calculator
Interest on the principal alone — SI = P × R × T / 100.
Months work too — six months is 0.5.
Enter a principal to see the interest.
How it works
Simple interest is charged on the original principal for the whole term — the interest never earns interest of its own. That makes it the arithmetic behind most short-term loans, gold loans and textbook problems. For anything that compounds, use the Compound Interest Calculator instead; the difference grows quickly with the term.
SI = P × R × T / 100 · Amount = P + SIExample
- ₹50,000 at 10% for 2 years = ₹10,000 interest
- Amount payable = ₹60,000
For calculation purposes only. Actual loan agreements may compound, charge fees or use a different day-count basis — this tool doesn't give financial advice.
About this calculator
Simple interest is charged on the original principal for the whole term — the interest never earns interest of its own. That makes it the arithmetic behind most short-term loans, gold loans, many fixed deposits quoted on a simple basis, and almost every textbook problem. Enter a principal, an annual rate and a term in years and this shows the interest and the total amount payable.
Terms shorter than a year work as fractions: six months is 0.5, three months is 0.25. The calculator also shows what the same sum would earn compounded annually, because that difference is usually the reason two quoted figures disagree.
Frequently asked questions
What is the simple interest formula?
SI = P × R × T ÷ 100, where P is the principal, R the rate per year as a percentage and T the time in years. The total amount payable is P + SI.
How do I calculate simple interest for months?
Convert the months to a fraction of a year and use the same formula. Nine months is 0.75 years, so ₹50,000 at 10% for nine months is 50,000 × 10 × 0.75 ÷ 100 = ₹3,750.
When is interest simple rather than compound?
It depends entirely on the agreement, not on the amount or the term. Many short-term and secured loans quote simple interest; most savings accounts, mutual funds and long-term deposits compound. If a lender quotes a rate without saying which, ask — over a long term the two produce very different totals.
Is simple interest better for a borrower?
At the same rate and term, yes: simple interest always costs less than compound, because the interest never starts earning interest. That is why comparing rates alone is not enough — the compounding basis matters as much as the number.