Simple Interest Calculator
Calculate simple interest with the classic SI = P × R × T / 100 formula.
SI = (P × R × T) / 100 | A = P + SI
Simple Interest Calculator
Simple Interest (SI) is calculated on the original principal amount only. Unlike compound interest, it does not compound over time. The formula is: SI = (P × R × T) / 100, where P = Principal, R = Annual Rate (%), T = Time (years). Total Amount = P + SI.
When Is Simple Interest Used?
- Short-term personal loans and car loans
- US Treasury bills and some bonds
- Some student loans (during grace period)
- Basic bank savings accounts in some countries
- Daily interest calculations
Simple vs Compound Interest
Simple interest is better for borrowers (you pay less over time). Compound interest is better for investors (your money grows faster). For a $10,000 investment at 8% for 10 years: SI = $8,000 return. CI ≈ $11,589 return — a $3,589 difference!