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Simple Interest Formula:
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The Student Loan Interest Calculator calculates the daily interest accrued on a student loan using the simple interest formula. It helps borrowers understand how much interest accumulates each day on their outstanding loan balance.
The calculator uses the simple interest formula:
Where:
Explanation: The formula calculates the interest that accrues daily on a student loan by multiplying the principal amount by the annual interest rate and the fraction of the year (days/365).
Details: Understanding daily interest accrual helps borrowers make informed decisions about repayments, estimate total interest costs, and plan their finances effectively to minimize interest expenses.
Tips: Enter the principal loan amount in ₹, annual interest rate as a percentage, and the time period in days. All values must be positive numbers.
Q1: Why calculate daily interest instead of monthly?
A: Daily interest calculation provides more precise tracking of interest accrual, especially for loans where payments may be made at irregular intervals.
Q2: Does this calculator work for compound interest?
A: No, this calculator uses simple interest calculation. For compound interest, a different formula would be required.
Q3: What's the difference between annual rate and daily rate?
A: The daily interest rate is the annual rate divided by 365 days, representing the interest that accrues each day.
Q4: Can I use this for other types of loans?
A: While designed for student loans, this calculator can be used for any loan that uses simple interest calculation with daily accrual.
Q5: How accurate is the 365-day year assumption?
A: Most financial institutions use 365 days for interest calculations, though some may use 360 days. Check with your lender for their specific method.