Simple Interest Calculator
Simple Interest Calculator (INR)
Calculate how much interest you'll earn or pay using simple interest formula in Indian Rupees. Visualize your principal and interest breakdown with our pie chart.
Please enter a valid amount (minimum ₹1)
Please enter a valid rate (0-100%)
Please enter a valid time period (minimum 1 day)
Simple Interest Formula
I = P × r × t
Where:
- I = Interest Amount (₹)
- P = Principal Amount (₹) (initial investment)
- r = Annual Interest Rate (in decimal)
- t = Time Period in years
Example: For ₹10,000 at 5% annual interest for 3 years: I = 10,000 × 0.05 × 3 = ₹1,500
About Simple Interest
Simple interest is a method of calculating interest where the interest is computed only on the original principal amount throughout the loan or investment period.
Key characteristics of simple interest:
- Interest is calculated only on the original principal
- Interest doesn't compound over time
- Commonly used for short-term loans and some investments
- Easier to calculate than compound interest
When is simple interest used in India?
- Short-term personal loans
- Fixed deposits with simple interest terms
- Some types of government savings schemes
- Short-term business loans
Note: Most bank savings accounts and long-term investments use compound interest, which yields higher returns as interest is calculated on both principal and accumulated interest.
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