Daily Interest Calculator (with Examples and Formula)

This online calculator computes the daily interest rate, the total interest accrued on an amount of money on a day-to-day basis and the final interest amount.


  • Principal or Initial amount in any currency
  • Annual Interest Rate
  • Time period (in years, months and days)

Example Calculations

Consider an annual interest rate of 20% compounded daily. The daily interest rate in this case is 0.054%

A principal amount of $1,000 results in a final value of $ after one year. After a year and six months, the same initial amount results in a


Daily interest (%) = Annual Interest (%) / 365

Total Interest = Principal × (1 + Daily Interest Rate)N – Principal

where N is the number of days


A daily interest calculator is a valuable tool that helps in determining the interest accrued on a principal amount on a day-to-day basis.

This method of interest calculation is particularly useful for short-term loans, credit card balances, and some savings accounts where interest is compounded daily.

Unlike monthly or annual interest calculations, daily interest is calculated based on the principal balance at the end of each day, compounded over time.

Note: Interest is added to the principal balance every day, resulting in the highest growth rate relative to weekly, monthly or annually.

How to use the daily interest calculator

A daily interest calculator automates the process of calculating interest accrued each day. Here’s how it works:

  • Input Principal Amount: Enter the initial amount of money on which interest will be calculated.
  • Enter Annual Interest Rate: Provide the annual interest rate as a percentage.
  • Specify Time Period: Define the duration for which the interest needs to be calculated (in years, months, days). For instance you can enter 1 year, 0 months and 15 days.
  • Compute Interest: The calculator then applies the daily interest formula to determine the daily interest and the total interest accrued over the specified period.

Practical Applications of Daily Interest Calculator

Credit Card Balances

Credit cards often use daily interest rates to calculate the interest on outstanding balances. For instance, if you have an outstanding balance of $1,000 with an annual interest rate of 20%, the daily interest rate would be approximately 0.055% (20% divided by 365). Using the daily interest calculator helps determine the total interest accrued = $221 if the balance is not paid off immediately.

Short-Term Loans

For loans where the interest is compounded daily, understanding the daily interest can help borrowers plan their payments more effectively. For example, a $5,000 loan with a 10% annual interest rate would accrue daily interest of approximately 0.0274%.

Savings Accounts

Some savings accounts offer daily compounding interest, meaning the interest earned each day is added to the principal balance, and interest is then calculated on this new balance the next day. For instance, if you deposit $10,000 in a savings account with an annual interest rate of 3%, the daily interest rate would be approximately 0.0082%. Over a period of one year, this daily compounding results in a total interest of $303.


A daily interest calculator is a powerful tool for managing and understanding the costs or benefits associated with daily compounding interest. Whether you are a borrower looking to manage your loan more effectively or an investor seeking to maximize returns, understanding how daily interest works can provide significant financial advantages.

By using a daily interest calculator, you can gain a clearer picture of your financial situation and make more informed decisions.

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