Loans / CALCULATOR
Loan Interest
Compare simple and reducing-balance interest.
How this works
Simple: SI = P × R × T ÷ 100. Reducing balance: EMI = P × r × (1+r)ⁿ ÷ [(1+r)ⁿ − 1]
Simple interest is charged on the full original principal for the whole term. Reducing-balance interest — how EMIs actually work — is charged only on the balance still outstanding, so it is normally lower.
Amounts are rounded for display; calculations use full precision. This utility is for planning and is not financial advice.