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Credit Exchange Interest

At a first glance, the formula for calculating monthly interest on credit exchange looks very complex and not very clear. To help you with it we will uncover the secret of calculation. The calculation depends on two indicators such as:

• the difference between the borrowed amount and the amount to be repaid
• credit term in months

For the calculation we will need indicators known to user:

• Borrowed amount – BA
• Repayment amount – RA
• Credit term in days – CTD

Actions:

• Calculating difference between BA and RA: Difference = RA – BA
• Calculating credit term in months (CTM): CTM = CTD : 30
• Calculating monthly interest (MI)): MI = (Difference * 100 : BA) : CTM

Example:

Borrowed amount: 10$
Amount to be repaid: 15$
Credit term in days: 60 days

Calculation:
Difference = 15 – 10 = 5 ($)
CTM = 60 : 30 = 2 (months)
MI = (5 * 100 : 10) : 2 = 25 (%)

See also:
Credit Exchange Interest

This article in other languages: Русский