Loan APR and Flat Rate Calculator
Find the real yearly cost of a loan once the fees are counted, and turn a flat rate into the reducing-balance rate you can compare. Free, no signup.
- Zero fees → APR = Nominal rate exactly. No extra cost, no markup.
- Any fees → APR > Nominal rate. Bank deducts fees upfront but you pay EMI on full amount — your effective cost rises.
- APR can never be less than nominal rate. If a tool shows that, it's a calculation error.
- Monthly compounding alone: 15% nominal = 16.08% EAR
- Processing fee ₹10,000 + GST ₹1,800 = ₹11,800 deducted
- You receive ₹9,88,200 but EMI is on full ₹10,00,000
What to look at next
How it works
- Enter the offer. The sanctioned amount, the interest rate and tenure, plus the processing fee, the GST on it, any insurance bundled in and other charges.
- Read the real cost. You see the APR, the yearly rate once the fees are counted, next to the headline rate, with the total you pay and the cost for every ₹1 lakh borrowed.
- Quoted a flat rate? Open the second tab. Enter the flat rate, the amount and the tenure to see the equivalent reducing-balance rate, which is the one you can compare with a bank's quote.
Questions people ask
What is APR, and how is it different from the interest rate?
The interest rate is the headline percentage on the loan. The APR (annual percentage rate) is the yearly cost once the processing fee, the GST on it, insurance and other charges are included, spread over the amount you actually receive. It is therefore usually higher than the quoted rate, and it is the fairer number for comparing two offers. RBI requires lenders to give you a Key Fact Statement before you sign, which includes the APR.
What is a flat rate, and how is it different from a reducing-balance rate?
A flat rate charges interest on the original loan amount for the whole tenure, even though you repay part of it every month. A reducing-balance rate charges interest only on what you still owe. For the same stated percentage, a flat rate costs far more; the equivalent reducing-balance rate is often close to double the flat rate. That is why a flat rate that looks low should be converted before you compare.
How do I convert a flat rate to a reducing-balance rate?
Work out the EMI under the flat rate: add the flat interest for the whole tenure to the principal and divide by the number of months. Then find the yearly rate on a reducing balance that gives the same EMI. The calculator does both steps when you enter the flat rate, amount and tenure.
What is the effective annual rate (EAR)?
Interest on a loan is usually charged monthly, so compounding makes the rate you actually pay over a year slightly higher than the nominal one. The EAR is that yearly figure: (1 + r ÷ 12)^12 − 1, where r is the nominal rate. The chart in the calculator shows the nominal rate, the EAR and the APR together.
Which fees should I enter?
The processing fee as a percentage of the loan, the GST on that fee (usually 18%), any insurance premium financed into the loan and other one-time charges. If you know the exact amount that reached your account, enter it as the disbursed amount for a more precise result.
How accurate are the results?
They are illustrative. A lender's own APR can differ slightly because of rounding, the exact disbursal date and how each charge is treated, so check the figure in the Key Fact Statement you are given.
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