Flat Rate vs. Reducing Balance Calculator
Many two-wheeler loans, consumer durable loans, and informal lending schemes are quoted at a ‘flat rate’ of interest. This sounds lower but is significantly more expensive than a reducing balance rate. A 10% flat rate is roughly equivalent to a 17–18% reducing balance rate. This calculator exposes the real cost and converts between the two.
₹
₹5,000
₹50 L
%
1%
30%
M
6 M
84 M
Hidden Cost
₹0
Flat Rate EMI₹0
Flat Rate Total Interest₹0
Flat Rate Total Repayment₹0
Equivalent Reducing Balance Rate0%
Reducing EMI at Same Nominal Rate₹0
Reducing Interest at Same Rate₹0
Extra Interest Paid₹0