Free Simple Interest Calculator
Simple interest is charged only on the original principal — it doesn't compound. It's the standard for short-term business loans, promissory notes and most invoice-financing arrangements.
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Disclaimer: This calculator provides estimates only and does not constitute financial advice. Actual loan terms may vary by lender.
About the Simple Interest Calculator
The formula
Simple Interest = (Principal × Rate × Time) / 100. Total Repayment = Principal + Interest. Time is expressed in years; if your period is in months, divide by 12 (this tool handles that automatically via the units toggle).
Simple vs compound
Simple interest is charged flat on the principal. Compound interest is charged on principal plus previously accrued interest, which grows the total much faster over long periods. For anything longer than a year, always model both.
Where you'll see it
Short-term business loans, working-capital lines, invoice discounting, some personal loans and most car loans marketed as 'flat rate'. Note: a 'flat 10%' loan usually has an effective (reducing-balance) rate closer to 18%.
Frequently asked questions
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