What is the simple interest formula?▾
SI = P × R × T ÷ 100, where P is principal, R the yearly rate in percent and T the time in years.
Where is simple interest used?▾
Short-term loans, some personal and car loans, delayed-payment interest on invoices, and many informal loans use simple interest.
Simple vs compound interest?▾
Simple interest is charged only on the principal. Compound interest is also charged on accumulated interest, so it grows faster over time.
How do I calculate interest for days?▾
Divide the number of days by 365 and use that as T. Interest on ₹1 lakh at 10% for 90 days is 1,00,000 × 10 × 90/365 ÷ 100 = ₹2,466.
