interest rate

American  

[in-ter-ist reyt, -trist] / ˈɪn tər ɪst ˌreɪt, -trɪst /

noun

Finance.

1. Business. the amount that a lender charges a borrower for taking out a loan, for maintaining a balance on debt, etc.: typically expressed as an annual percentage of the loan balance.

2. Banking. the amount earned on a savings, checking, or money market account, or on an investment, such as a certificate of deposit or bond: typically expressed as an annual percentage of the account balance or investment sum.

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interest rate Cultural  

1. The usual way of calculating interest — as a percentage of the sum borrowed.

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Etymology

Origin of interest rate

First recorded in 1885–90

Compare meaning

How does interest-rate compare to similar and commonly confused words? Explore the most common comparisons:

• discount rate vs. interest rate

Example Sentences

Rising energy prices have increased the probability of either interest rate hikes or delayed cuts by central banks wary of inflation, UBS noted.

From Barron's • Mar. 31, 2026

The FCA banned DCAs in 2021, arguing they provide an incentive for a buyer to be charged a higher-than-necessary interest rate, leaving them paying too much.

From BBC • Mar. 31, 2026

But that’s only correct if the interest rate compensates for Treasury’s cost of funds and the associated risk of IMF lending from the quota.

From The Wall Street Journal • Mar. 29, 2026

The ECB left its key interest rate unchanged last week, but expects energy price rises to increase inflation and slow growth.

From The Wall Street Journal • Mar. 27, 2026

In exchange, he received a higher interest rate.

From "The Big Short" by Michael Lewis

Related Words

• interest