simple interest

American  

noun

1. interest payable only on the principal; interest that is not compounded.

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simple interest British  

noun

1. interest calculated or paid on the principal alone Compare compound interest

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simple interest Scientific  

1. Interest computed only on the original principal and not on the sum of the principal plus accrued interest. The amount of simple interest remains constant.

2. Compare compound interest

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Etymology

Origin of simple interest

First recorded in 1790–1800

Example Sentences

To understand how compound interest works, let’s look at another kind of interest: simple interest.

From Seattle Times • Aug. 1, 2022

Robin deposited $31,000 in a bank account that earned simple interest at an interest rate of 5.2%.

From Textbooks • May 6, 2020

Carleen deposited $16,400 in a bank account that earned simple interest at an interest rate of 3.9% How much interest was earned in eight years?

From Textbooks • May 6, 2020

The formula we use to calculate simple interest is I = Prt.

From Textbooks • Apr. 22, 2020

The children saw them burn with simple interest in each new conflagration.

From Mr. Kris Kringle A Christmas Tale by Mitchell, S. Weir (Silas Weir)