Interest Calculator
This is the fastest route to a single interest figure: principal, rate, time, done. It uses the flat simple-interest formula rather than compounding, which makes it the right tool the moment someone quotes you a rate 'per year, flat' — a bridging loan, a family loan, or a bond coupon — and you just need the number without building an amortisation table.
Inputs
Result
35,000
Maturity amount 135,000
How it works
SI = P × R × T ÷ 100
- 1SI = 100000 × 7 × 5 ÷ 100 = 35,000
How the interest calculator works
Simple interest: SI = P × R × T ÷ 100, where P is the principal, R is the annual rate as a whole number (7, not 0.07), and T is the time in years. Maturity amount = P + SI.
The base never changes here — interest is earned only on the original principal, never on interest already accrued. That is what makes the formula linear: double the time and the interest exactly doubles.
This is deliberately the simple-rate tool. For a deposit or loan that compounds — most savings accounts, most mortgages — use the Compound Interest Calculator instead, since simple interest will understate the real return or cost.
Worked example: 100,000 at 7% for 5 years
- SI = 100,000 × 7 × 5 ÷ 100 = 35,000.
- Maturity amount = 100,000 + 35,000 = 135,000.
- Interest is flat at 7,000 per year for every one of the 5 years — year 1 and year 5 add exactly the same amount.
- The same 100,000 at 7% compounded annually would instead grow to roughly 140,255 over 5 years — 5,255 more, purely from interest earning interest.
Common mistakes to avoid
Using this for a compounding product
Simple interest is the exception, not the rule, for real savings and loan products. If your statement shows interest added periodically and then itself earning interest, use the Compound Interest Calculator instead.
Entering the rate as a decimal
This tool takes the rate as a plain percentage number, e.g. 7 for 7%. Entering 0.07 divides the result by 100 again and understates the interest hugely.
Feeding in months instead of years
T is in years. For 9 months, enter 0.75, not 9 — entering whole months inflates the result by roughly twelvefold.
Frequently asked questions
When is interest actually simple rather than compound?
Flat-rate vehicle and consumer loans, most bond coupon payments, short bridging finance, and statutory interest on late payments or court awards are the common real-world cases.
How is this different from the Simple Interest Calculator?
They use the same formula. This page is the fast single-purpose version; the Simple Interest Calculator goes deeper into flat-rate-versus-reducing-balance comparisons and part-year timing.
Why is my bank quoting a much higher effective cost than this number?
Flat-rate loans are often marketed on the simple-interest figure while the true reducing-balance cost is considerably higher. A 'flat 8%' car loan is roughly equivalent to 14–15% reducing balance.
Can I work backwards to find the rate from a known interest amount?
Yes: R = (Interest × 100) ÷ (P × T). If 20,000 earned 3,000 over two years, the rate is (3,000 × 100) ÷ (20,000 × 2) = 7.5%.
Does this calculator handle compounding frequency?
No — that is intentionally the Compound Interest Calculator's job, where you can choose annual, quarterly, monthly or daily compounding and see how the result changes.
Related calculators
Simple Interest Calculator
Flat interest on a principal amount.
Compound Interest Calculator
See how money compounds over time with any compounding frequency.
Loan Calculator
Estimate repayments, total cost and interest for personal or auto loans.
FD Calculator
Maturity value of a fixed deposit with quarterly compounding.
Savings Calculator
How much your savings grow with regular monthly deposits.