Flat vs. Reducing Rate Loan Calculator
Compare flat-rate and reducing-balance loans side by side: the EMI, total interest and total cost for the same amount and tenure. Free, instant, no signup.
Flat vs Reducing Rate Calculator — Don't Get Fooled by "Lower" Interest Rates
"7% interest only!" sounds great until you discover it's a flat rate — which actually equates to about 13% on a reducing balance basis. Many vehicle finance, consumer durable, and small lending products quote rates in flat terms, making them look cheaper than they really are. Our Flat vs Reducing Rate Calculator shows the true cost so you can compare apples to apples.
Enter the loan amount, the interest rate and the tenure, and the calculator works out the EMI, total interest and total cost under both methods at that same rate, and how much less the reducing-balance loan costs. No signup, no cost.
How to Compare Flat vs Reducing
1. Loan Amount
Enter the principal you're planning to borrow.
2. Interest Rate
Enter the annual rate (e.g. 7% a year). The calculator applies it both as a flat rate and as a reducing-balance rate.
3. Tenure
Enter the loan tenure in years — common for vehicle finance is 3-5 years.
4. View Comparison
See the EMI, total interest and total cost under both methods side by side, and how much the reducing-balance method saves.
Calculator Features
Same Rate, Both Methods
One rate is applied two ways: flat, on the original principal for the whole tenure, and reducing, on the balance still owed each month.
Multiple Currencies
Show amounts in any of 20 currency symbols, from the rupee and US dollar to the euro, pound and yen. Only the symbol changes; nothing is converted.
EMI Side by Side
See the EMI under both methodologies for the same loan — easy to spot the better deal.
Total Interest Comparison
See the total interest under both methods. At ₹10 lakh, 10% and 5 years, the flat rate charges ₹5,00,000 in interest against ₹2,74,823 on a reducing balance.
Visual Comparison
A bar chart puts the total repayment under each method side by side.
Free and Private
No signup, no tracking. Runs entirely in your browser.