Monthly Interest Calculator
Find the monthly interest on any deposit or loan amount — payout mode for regular monthly income, or reinvest mode where interest compounds each month.
Inputs
Report details (optional — appears on the PDF report)
Results
Formula
- P = principal · R = annual rate (%) · monthly rate r = R/12/100
- Payout mode: total interest = monthly interest × number of months
- Reinvest mode: A = P × (1 + r)months, total interest = A − P
How It Works
The annual rate is divided by 12 to get the monthly rate, then applied to the principal. In payout mode the interest is withdrawn each month, so the principal never changes and every month's interest is identical — this is how monthly-income deposit schemes work.
In reinvest mode the interest stays in the account and earns further interest, so the balance compounds monthly and the final amount is higher.
Worked Example
Given: P = ₹500,000, R = 7.5% p.a., 12 months, payout mode
Monthly interest = 500,000 × 7.5 / (12 × 100) = ₹3,125 per month
Total interest over 12 months = 3,125 × 12 = ₹37,500
In reinvest mode the same inputs give ≈ ₹38,807 — about ₹1,307 more from monthly compounding.
Engineering Notes
- Payout mode matches monthly-income schemes; reinvest mode matches cumulative deposits.
- Banks may compound quarterly rather than monthly — check the scheme terms before comparing.
- Tax deducted at source (TDS) on interest income is not applied here.
- For loans, the monthly interest shown is the interest component only, not an EMI.
FAQ
How do I get monthly interest from an annual rate?
Divide the annual rate by 12, then apply it to the principal.
Which mode should I pick?
Payout if you withdraw the interest each month for income; reinvest if you leave it to grow.
Is this the same as EMI?
No — EMI includes principal repayment. This shows interest alone.
Related Calculators
This calculator uses established formulas and standard calculation methods to provide reliable results for planning, estimation and reference.