Simple Interest Calculator
Interest on principal only
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About this calculator
Simple interest is charged only on the original amount, never on interest already earned. It is used for many short-term loans and some bonds.
The formula
Interest = principal × rate ÷ 100 × time (years)
Worked example2,000 at 4% for 3 years → 240 interest, total 2,240.
Frequently asked questions
Simple vs compound interest?
Compound interest also earns interest on past interest, so it grows faster over time.
How do I use months?
Switch the unit to months; the calculator converts to years.
Which is better for borrowers?
Simple interest usually costs less than compound at the same rate.
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