1. What is Simple Interest?

Simple interest is a method of calculating interest charge on a loan where interest is calculated only on the original principal amount throughout the loan tenure.

2. How Does the Calculator Work?

The calculator uses the simple interest formula:

Where:

• \( P \) — Principal loan amount (INR)
• \( r \) — Annual interest rate (in decimal)
• \( t \) — Time period in years

Explanation: The formula calculates total interest payable by multiplying principal amount with annual interest rate and loan tenure in years.

3. HDFC Personal Loan Interest Rates

Details: HDFC Bank offers personal loans starting at 10.50% p.a. interest rate (as of 2023). Actual rates may vary based on credit profile, loan amount, and tenure.

4. Using the Calculator

Tips: Enter principal amount in INR, annual interest rate (10.50% is pre-filled as HDFC's starting rate), and loan tenure in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: Is this calculator specific to HDFC Bank?
A: While it uses HDFC's starting interest rate by default, the simple interest formula applies to any loan.

Q2: Does HDFC use simple or compound interest?
A: Most banks including HDFC use reducing balance (compound) method. This calculator shows simple interest for basic estimation.

Q3: What are HDFC's current personal loan rates?
A: Rates start at 10.50% p.a. but may vary from 10.50% to 21% based on applicant's creditworthiness.

Q4: What is the maximum loan amount from HDFC?
A: HDFC offers personal loans up to ₹40 lakhs depending on income and repayment capacity.

Q5: How accurate is this calculator?
A: It provides basic estimation. For exact EMI calculation, use HDFC's official EMI calculator which considers compounding.