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Calculate simple interest with SI vs CI comparison — see the real cost of flat-rate interest
Enter investment details and click Calculate SI
Simple interest (SI) is the most straightforward method of calculating interest on a principal amount. The formula is SI = P × R × T / 100, where P is the principal (the original amount of money), R is the annual interest rate in percentage, and T is the time period in years. Unlike compound interest, simple interest is calculated only on the original principal — not on any accumulated interest. This makes it predictable and easy to calculate mentally: at 8% per annum, every Rs 1 lakh earns exactly Rs 8,000 per year, regardless of how many years the money is invested.
For example, if you invest Rs 5,00,000 at 10% simple interest for 3 years, the interest earned is Rs 5,00,000 × 10 × 3 / 100 = Rs 1,50,000. The total amount you receive after 3 years is Rs 6,50,000. Simple interest is linear — the interest earned is the same every year. This is in contrast to compound interest, where interest is reinvested and grows exponentially over time.
The key difference between simple interest and compound interest lies in how interest is calculated. With SI, interest is always computed on the original principal. With CI, interest is computed on the principal plus all previously earned interest. In year 1, both SI and CI yield the same result. From year 2 onward, CI starts pulling ahead because it earns “interest on interest.”
Consider Rs 1,00,000 at 10% for 20 years: Simple interest gives Rs 2,00,000 in interest (total Rs 3,00,000). Compound interest (annual) gives Rs 5,72,750 in interest (total Rs 6,72,750) — nearly 2.9 times more interest than SI. This massive gap is why financial advisors always recommend compound-interest instruments like mutual funds, PPF, and FDs (which compound quarterly) over flat-rate simple interest options for long-term wealth creation.
Despite compound interest being more common in investments, simple interest is still widely used in several financial products in India. Personal loans from some NBFCs and money lenders use flat-rate (simple) interest, where the EMI is calculated on the original loan amount throughout the tenure. Car loans advertised with “flat rates” use simple interest — a 7% flat rate on a car loan is actually equivalent to about 12.5% reducing rate (compound interest). FD interest payouts (monthly or quarterly payout option) effectively pay simple interest because the interest is withdrawn rather than reinvested. Some government savings schemes and short-term deposits also use simple interest for their calculations.
When banks and NBFCs advertise loan interest rates, they may quote either a “flat rate” or a “reducing rate.” A flat rate (simple interest) calculates interest on the entire original principal for the full tenure. A reducing rate (compound interest) calculates interest only on the outstanding principal balance, which decreases with each EMI payment. As a rule of thumb, a flat rate is approximately 1.8 to 1.9 times the equivalent reducing rate. So a “7% flat rate” personal loan actually costs about 12.6% to 13.3% in reducing-balance terms. Always ask the lender for the reducing rate or the Annual Percentage Rate (APR) before comparing loan offers. This calculator helps you understand the difference between flat and reducing rate interest by showing SI vs CI side by side.
| Feature | JumpTools | ClearTax | Groww | Paytm Money | Cuemath |
|---|---|---|---|---|---|
| Price | Free | Free (limited) | Free | Free (ads) | Free |
| Registration | No signup | Required | Required | Required | No signup |
| SI vs CI Comparison | Side-by-side chart | No | No | No | Formula only |
| Growth Chart | Interactive line chart | No | Basic | No | No |
| Year-by-Year Table | Full breakdown | No | No | No | No |
| Pre-computed Table | 150 rows | No | No | No | No |
| CSV Export | Yes | No | No | No | No |
| Privacy | 100% client-side | Server-based | Server-based | Server-based | Client-side |
Calculate SI using the standard formula: SI = P x R x T / 100. Instant results with no server calls.
Interactive line chart showing how simple interest (linear) and compound interest (exponential) diverge over time.
Detailed table showing SI interest, SI total, CI total, and the difference for each year of your investment.
See exactly how much more compound interest earns compared to simple interest for any principal and tenure.
Pre-computed SI for every principal from Rs 1L to Rs 1.5Cr at multiple rates with CI comparison column.
Download the complete 150-row table as CSV for offline analysis, financial planning, or client presentations.
Enter Principal Set the principal amount from Rs 1,000 to Rs 10 Cr using the slider or quick buttons.
Set Rate & Period Choose the annual interest rate (1-20%) and time period (1-30 years).
Calculate SI Click Calculate SI to see simple interest, total amount, CI comparison, and the CI-SI difference.
Compare Results View the SI vs CI growth chart, year-by-year breakdown, and insights on which is better for your scenario.
Calculate simple interest instantly with SI = P x R x T / 100. Compare SI vs CI with interactive chart. Year-by-year breakdown table. 150-row pre-computed reference table. 100% client-side.