Village Interest Calculator

Easily calculate the interest of the loan.

Village interest calculator is an online interest calculator that is mostly used by villagers and moneylenders to calculate the monthly interest on the loan.

In rural area, villagers and farmers often need money to carry out their agricultural or livelihood activities. But getting a loan from bank is quite not easy for most of the villagers due to lack of colateral security.

In such cases, villagers takes loan at high interest rate from the moneylenders. In villages, interest is often calculated using the interest per ₹100 per month. For example, Mahesh who is a farmer took a loan of ₹10,000 from a loan shark at ₹4 rupee per 100.

Now, for every 100 rupees Mahesh have to pay an interest amount of 4 rupee per month. Since, Mahesh took ₹10,000, then he have to pay ₹400 interest per month.

Suppose Mahesh cleared the loan after 3 months, then Mahesh have to pay a total interest of (₹400 x 3) = ₹1200 rupees.

Types of Interest

There are two types of interest:

Simple Interest
Compound Interest

Interest Formula

The following formula are used to calculate the simple interest and compound interest:-

Simple Interest

Simple Interest (SI) = (P x R x T)/100

where,

P = Principal Amount
R = Rate of Interest Per Year (in %)
T = Time Period (in years)

Compound Interest

Amount = P x (1 + R/100)^T

Compound Interest (CI) = Amount - P

where,

P = Principal Amount
R = Rate of Interest Per Year (in %)
T = Time Period (in years)

Solved Examples

Example 1: Calculate the interest for the principal amount of ₹50,000 where the interest is ₹4 rupee per ₹100 and time period is 3 months. (Simple Interest)

Principal Amount (P) = ₹50,000

Rate of Interest = 4/100 = 0.04

Time Period = 3 Months

So, Simple Interest = (P x R x T)/100 = (50000 x 0.04 x 3) = ₹6000