Simple Interest Calculator
The Simple Interest Calculator computes the interest on a principal amount using the classic simple-interest method, where interest is charged only on the original sum and never on previously earned interest. Enter the principal, the annual rate and the time period to see the interest and the total amount due.
When simple interest applies
Simple interest is used for many short-term loans, some fixed deposits, car loans in certain markets, and most textbook problems. Because interest is charged only on the original principal, the amount you owe grows in a straight line rather than accelerating like compound interest.
The formula
The interest is SI = P × R × T / 100, where P is the principal, R is the annual rate in percent and T is the time in years. The total amount to repay is P + SI.
A worked example
Borrow 50,000 at 6% per year for 3 years. SI = 50000 × 6 × 3 ÷ 100 = 9,000. So over three years you pay 9,000 in interest and repay 59,000 in total. Notice the interest is exactly 3,000 per year, every year, because it never compounds.
Simple versus compound
For the same principal, rate and time, compound interest always ends up higher than simple interest because it earns interest on interest. Over one year the two are nearly identical; over many years they diverge a lot. If a lender quotes simple interest, that is usually good news for you compared with the compound equivalent.
How to use
- Enter your details in the fields above. The Simple Interest Calculator accepts everyday values and checks them as you type.
- Press the action button (or just start typing for live tools) to run the calculation.
- Read your result, along with any supporting figures, in the clearly labelled result box.
- Use Copy result to grab the answer, Reset to start again, or Copy link to share this tool.
Why use this tool
Finance Wave built the Simple Interest Calculator to be genuinely useful: it validates your input so you never see a broken result, formats numbers for your region automatically, and stays readable in both light and dark mode. Because everything happens on your device, it is private by design and keeps working even without an internet connection once the page has loaded.