Simple Interest Calculator 2026
Flat-rate interest — no compounding. Quick math for short loans and basic deposits.
Total amount
₹1.40 L
You'll earn ₹40,000 as simple interest over 5 years.
Principal vs Interest
₹1.00 L
₹40,000
Year-by-year breakdown
| Year | Interest this year | Cumulative interest | Balance |
|---|---|---|---|
| 1 | ₹8,000 | ₹8,000 | ₹1.08 L |
| 2 | ₹8,000 | ₹16,000 | ₹1.16 L |
| 3 | ₹8,000 | ₹24,000 | ₹1.24 L |
| 4 | ₹8,000 | ₹32,000 | ₹1.32 L |
| 5 | ₹8,000 | ₹40,000 | ₹1.40 L |
Growth chart
Simple Interest Mathematics: Linear Capital Growth and Short-Term Borrowing
Simple interest represents linear growth where interest is computed solely upon the original principal balance throughout the tenure. It is standard in short-term promissory notes, informal credit, and academic loan moratorium periods.
Where P is Principal, R is Annual Rate, and T is Time Period in Years.
Simple Interest FAQs
Basic concepts and practical financial applications of simple interest.
Where is simple interest officially used in modern banking?
Simple interest is commonly applied during education loan moratorium periods, agricultural crop loans, overdraft facilities, and short-term gold loans.
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