Simple Interest Calculator

Calculate simple interest on any loan or investment. Uses P×R×T/100 formula. Shows principal, interest earned, and total amount for any period.

Simple Interest Calculator

P x R x T / 100 formula — interest on loans and short-term investments

Principal amount Rs 1,00,000
Rs 1KRs 1Cr
Rs
Interest rate 8% p.a.
1%30%
% p.a.
Time period 3 years
1 yr30 yr
yrs
Simple interest
---
P x R x T / 100
Total amount
---
principal + SI
CI earns extra
---
vs simple interest
Principal (P)---
Rate (R)---
Time (T)---
Simple interest (P x R x T / 100)---
Compound interest (for comparison)---
CI earns this much more---
Principal vs simple interest earned
Principal: ---
SI earned: ---

Estimates for personal financial planning. Consult a financial advisor for personalised advice.

SI vs CI total amount over years
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ThriftRupee Insight

Simple interest is used for short-term loans (gold loans, car loans in some banks) and certain savings schemes. Unlike compound interest, SI does not earn interest on interest — so Rs 1 lakh at 10% for 3 years earns Rs 30,000 SI vs Rs 33,100 in compound interest. For savings, always prefer compound interest. For loans, SI is better — you pay less overall.

Simple Interest Calculator — P x R x T / 100

Simple interest is calculated only on the original principal throughout the loan or investment period. It is used for gold loans, some vehicle loans, and short-term deposits. Unlike compound interest, it does not earn interest on interest.

Frequently asked questions

What is the simple interest formula?▼
Simple Interest (SI) = P × R × T / 100, where P = Principal amount, R = Rate of interest per annum (%), T = Time period in years. Total Amount = P + SI. Example: P = Rs 50,000, R = 8%, T = 2 years → SI = 50,000 × 8 × 2 / 100 = Rs 8,000. Total = Rs 58,000.
Which loans use simple interest?▼
Gold loans typically use simple interest, as do some vehicle loans and short-term personal loans. Most home loans, education loans, and credit card dues use compound interest (which is more expensive for borrowers). FDs and savings instruments use compound interest quarterly or annually.
What is the difference between simple and compound interest?▼
Simple interest is calculated only on the original principal throughout the loan period. Compound interest is calculated on principal plus accumulated interest from previous periods. For long periods, compound interest grows significantly larger than simple interest on the same principal and rate.

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