Simple Interest Calculator
Calculate simple interest, interest payout, and total amount quickly and accurately.
Simple Interest Calculator
$
$100$1,000,000
%
0.5%30%
yr
1 yr30 yr
Formula: SI = (P × R × T) / 100
Simple interest does not compound — interest is calculated only on the original principal.
Simple interest does not compound — interest is calculated only on the original principal.
Results
Principal$10,000
Simple Interest$2,400
Total Amount$12,400
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How Simple Interest is Calculated
Simple interest is determined by multiplying the daily interest rate by the principal by the number of days or years elapsed between payments.
SI = ( P × R × T ) / 100
P = Principal sum of money
R = Annual interest rate (%)
T = Time period in years
Total Amount = Principal + SI
Simple Interest vs Compound Interest
| Feature | Simple Interest | Compound Interest |
|---|---|---|
| Principal | Remains constant throughout tenure | Increases every period as interest is added |
| Interest Growth | Linear / Constant every year | Exponential growth over time |
| Where Used | Short-term loans, auto loans, consumer credit | Fixed deposits, savings accounts, mutual funds |
Frequently Asked Questions
How do you calculate simple interest when time is given in months or days?
Convert months into years by dividing by 12 (e.g. 6 months = 6/12 = 0.5 years). For days, divide by 365 (e.g. 73 days = 73/365 = 0.2 years).