Use this free compound interest calculator to find the maturity value of any one-time investment. Adjust the principal, rate, time, and how often interest is compounded - daily, monthly, quarterly, half-yearly, or yearly - to see exactly how your money grows.
Maturity amount
₹2,20,804
Principal
₹1,00,000
Interest earned
₹1,20,804
Principal vs. Interest
Real-world FDs and savings products may apply TDS, lock-ins, or different compounding rules. Confirm with the issuer before investing.
لا يزال بعض المحتوى معروضًا بالإنجليزية.
Compound interest is the engine that powers nearly every long-term financial product - fixed deposits, recurring deposits, PPF, EPF, mutual funds, and even the unpaid balance on your credit card. It's the reason a one-time ₹5 lakh investment at 8% for 30 years grows into roughly ₹50 lakh, and the reason a ₹50,000 credit card balance at 36% APR can balloon into ₹2 lakh in just five years if you only pay the minimum due. Understanding the mechanics lets you put it to work in your favour and stay alert to the times it works against you.
This calculator implements the standard compound interest formula used by every Indian bank, post office, AMC and government scheme. Plug in the variables exactly as they appear in your product brochure or sanction letter and the maturity value here will match the bank's number to the rupee. If it doesn't, the most common reasons are a different compounding frequency than you assumed (Indian FDs typically compound quarterly, not annually) or interest being credited on a 365- vs 360-day year basis.
Enter the principal amount you want to invest.
Enter the annual rate of interest exactly as published - do not divide it by anything yourself.
Enter the time period in years (decimals like 7.5 are allowed).
Choose the compounding frequency: yearly, half-yearly, quarterly, monthly, or daily.
View the maturity value, total interest earned, and a year-wise growth table.
Toggle between compounding frequencies to see how a daily-compounding savings account compares to a quarterly-compounding FD on the same rate.
Compound interest is interest you earn on both the original principal and the previously earned interest. Each compounding period the bank computes the interest on the running balance, adds it back to the balance, and uses the new balance for the next period. Over long horizons this 'interest on interest' grows much faster than simple linear interest. The more frequently the compounding happens, the faster the snowball - but the marginal difference between, say, monthly and daily compounding is small.
A = P × (1 + r/n)^(n × t)
The formula A = P(1 + r/n)^(nt) generalises simple interest by replacing the interest period of one year with a fraction of a year. With each compounding period, you apply a smaller rate (r/n) to a balance that includes prior interest. As n approaches infinity, the formula approaches continuous compounding A = P × e^(rt) - used in advanced finance but rarely in retail products. For everyday Indian banking, n is 1 (yearly), 2 (half-yearly), 4 (quarterly), 12 (monthly), 365 (daily) or 365.25 (continuous-like).
Indian fixed deposit calculations almost universally use quarterly compounding (n = 4). The rate quoted is annual; the bank divides by 4 each quarter, applies it, and adds it to the principal. This is why a 7% FD effectively yields about 7.19% over a year - the difference is the quarterly compounding bonus. Recurring deposits use the same quarterly compounding but applied to a series of monthly contributions, similar to a SIP but with a guaranteed rate.
For PPF the government compounds annually at the rate notified each quarter - so the 'compound' formula here applies but the rate may change between years. For EPF, interest is credited annually and the rate is announced after year-end. For credit cards, compounding is typically daily on the unpaid principal - which is what makes credit card debt so corrosive. Use this calculator with daily compounding and a 36% rate to see how a ₹1 lakh balance grows if you let it sit.
The Rule of 72 is a handy mental shortcut: divide 72 by the annual rate to estimate how many years it takes to double your money. At 8%, 72/8 = 9 years to double. At 12%, 72/12 = 6 years. The rule comes from a Taylor expansion of the compounding formula and is accurate within 1-2% for rates between 4% and 15%.
P = ₹5,00,000, r = 0.07, n = 4, t = 5. Maturity = ₹5,00,000 × (1 + 0.07/4)^20 = approximately ₹7,07,365. Total interest: ₹2,07,365. The same FD at simple interest would have yielded only ₹1,75,000 in interest - quarterly compounding adds about ₹32,000 over 5 years.
Each year you add ₹1,50,000 and the entire running balance compounds annually at 7.1%. After 15 years the maturity is approximately ₹40,68,000 - of which ₹22,50,000 is your contribution and ₹18,18,000 is interest. Tax-free under Section 10(11) of the Income Tax Act, making the effective post-tax return higher than equivalent FDs for those in higher tax brackets.
P = ₹2,00,000, r = 0.12, n = 1, t = 25. Maturity = ₹2,00,000 × 1.12^25 = approximately ₹34,00,000 - your money grows 17×. The interest in the final year alone (₹3.5 lakh) exceeds the entire original investment. This is the classic compounding tail effect that makes long-horizon investing so much more rewarding than short-horizon trading.
Compound interest is the interest you earn on your principal plus the interest already accumulated. Unlike simple interest, the interest itself starts earning interest from the next period - which is what produces the exponential growth that makes long-term investing so powerful.
Simple interest is calculated only on the original principal. Compound interest is calculated on the principal plus the interest already earned, so the corpus grows faster the longer you stay invested. Over short periods (1-2 years) the difference is small; over 20+ years it's enormous.
More frequent compounding gives slightly higher returns. Daily > monthly > quarterly > half-yearly > annually. The difference between annual and daily compounding on a 7% rate is roughly 0.25 percentage points of effective yield - small in any one year, meaningful over 30 years.
Bank Fixed Deposits, Recurring Deposits, PPF, EPF, savings accounts, mutual fund growth, bond reinvestment and most loan products all use compound interest in some form. Credit cards use daily compounding, FDs typically quarterly, PPF annually.
Yes. On savings, it works in your favour by growing your money faster. On loans, it works against you because unpaid interest gets added to the principal - credit card debt at 36% APR is the classic cautionary tale.
Each period's interest becomes part of the principal for the next period. After many cycles, the interest itself starts earning meaningful interest - that exponential pattern is what makes long-term investing so powerful and short-term trading so much less effective.
Divide 72 by the annual rate to estimate how many years it takes to double your money at compound interest. At 8% it's 9 years; at 12% it's 6 years; at 6% it's 12 years. Quick mental check before pulling out a calculator.
Indian financial products - home loans, fixed deposits, mutual funds, NPS, insurance - each carry their own quirks: monthly reducing balance vs flat-rate interest, quarterly vs monthly compounding, indexation on capital gains, the choice between the old and new tax regime. We design every finance calculator to use the formula that an Indian bank, AMC, or insurer would actually use, and to surface the assumptions in plain English so you can audit the result against your own statement.
Use this calculator alongside the EMI, SIP and inflation calculators to plan your money holistically. A standalone EMI number means little until you compare it with your in-hand salary, your existing debt-to-income ratio, and the impact of inflation on the real cost of the loan. The related-tool grid below makes it one click to chain these analyses together.
The Compound Interest Calculator is part of the Finance suite on Online Calculator Tools, alongside 6 related calculators. All tools share the same UI patterns, the same privacy-first rendering (nothing is sent to a server), and the same commitment to showing the formula and assumptions behind every result.
