Simple Interest Calculator
Calculate simple interest and total amount using P × R × T ÷ 100.
Interest and total amount
Interest earned
₹40,000
Interest / year
₹8,000
Rate
8.00%
📈 Year-by-year growth
| Year | Interest (year) | Interest so far | Balance |
|---|---|---|---|
| Year 1 | ₹8,000 | ₹8,000 | ₹1,08,000 |
| Year 2 | ₹8,000 | ₹16,000 | ₹1,16,000 |
| Year 3 | ₹8,000 | ₹24,000 | ₹1,24,000 |
| Year 4 | ₹8,000 | ₹32,000 | ₹1,32,000 |
| Year 5 | ₹8,000 | ₹40,000 | ₹1,40,000 |
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🪙What simple interest is
Simple interest is calculated only on the original principal— never on the interest already earned. That makes it grow in a straight line: the same amount is added every year. It's common in short-term loans, car loans, and many fixed-deposit and exam problems, and it's the perfect baseline to compare against compound interest.
🔁Solve for any of the four
- Interest — the classic: how much interest a deposit earns over time.
- Principal — how much to deposit to earn a target interest.
- Rate — the interest rate implied by a principal, interest, and time.
- Time — how long it takes to earn a target amount of interest.
🧮The formula
P is the principal, R the annual rate in percent, and T the time in years. The interest I is added to the principal to get the total amount A. Because the formula is a simple product, any one of the four values can be found from the other three.
⚖️Simple vs compound — which applies?
- Simple interest: the rate applies only to the original principal (straight-line growth).
- Compound interest: the rate applies to principal plus past interest (accelerating growth).
- Short-term and many consumer loans use simple interest; savings and investments usually compound.
- For the same rate and time, compound interest always ends higher — check both before you decide.
💡 Frequently Asked Questions
What is the simple interest formula?+
I = P × R × T ÷ 100, where P is the principal, R is the annual rate in percent, and T is time in years. The total amount is A = P + I.
Can this find the rate, time, or principal too?+
Yes. Use the mode switch to solve for the principal, rate, or time — enter the three values you know and the fourth is calculated instantly.
How is simple interest different from compound interest?+
Simple interest is charged only on the original principal, so it grows by the same amount each year. Compound interest is charged on the principal plus previously earned interest, so it grows faster over time.
Where is simple interest used?+
It's common in short-term and car loans, some fixed deposits, and school and competitive-exam problems. Many everyday interest questions assume simple interest unless compounding is stated.