Simple Interest Calculator
Calculate simple interest on a principal over years, months or days, and see the interest and the total amount repayable.
How to use it
- Enter the principal, the annual rate and the time period.
- Switch the time unit if your term is in months or days.
- Simple interest never compounds — it is charged on the original principal only.
Examples
| 10,000 at 6.5% for 3 years | Interest 1,950 |
| 5,000 at 8% for 90 days | Interest 98.63 |
Simple interest charges a fixed percentage on the original principal only, for every period of the loan — I = P × r × t. Unlike compound interest, past interest never earns interest of its own, which makes the total predictable and, for a borrower, cheaper than an equivalent compounding loan over the same term.
Worked example
A £10,000 loan at 6.5% annual simple interest for 3 years: I = 10,000 × 0.065 × 3 = £1,950. Total repayable, A = P + I = £11,950. Because it's simple interest, that £1,950 is fixed the day the loan is signed — it doesn't move if repayments are late or early, unlike compounding balances.
Simple vs compound, same numbers
| Term | Simple interest (6.5%) | Compound, annual (6.5%) |
|---|---|---|
| 1 year | £650 | £650 |
| 3 years | £1,950 | £2,079 |
| 10 years | £6,500 | £8,771 |
Where simple interest still shows up
Short-term personal loans, some car finance deals, bond coupon payments, and per-day interest calculations (like the 90-day example above, worked as t = 90 ÷ 365 of a year) all use simple interest. Anything running more than a couple of years — mortgages, most savings accounts, credit cards — compounds instead, and the gap between the two widens fast with time.
Questions people ask
When is simple interest actually used?
Short-term loans, car finance in some markets, and many bond coupon calculations. Most savings accounts and mortgages compound instead.
How much difference does compounding make?
Over three years at 6.5%, simple interest on 10,000 is 1,950; compounded annually it is 2,079. The gap widens sharply with time.
Is anything sent to a server?
No. Every calculation runs in your browser, so nothing you type is uploaded and the page keeps working offline once it has loaded.
Last updated 17 August 2026