Interest on outstanding principal
Reducing balance
Interest is charged on the remaining loan principal. As you repay, interest cost falls. Contrast with flat-rate quotes.
In simple terms
Interest is charged on the remaining loan principal. As you repay, interest cost falls. Contrast with flat-rate quotes. Use the related calculators below to see the idea in numbers — results are illustrative, not advice.
Related calculators
Related terms
Sources & methodology
- Verify definitions against official scheme / tax documents — terms and rates can change by notification
- Aaru Wealth Methodology
Always verify current rates, slabs and scheme rules on official portals. Calculator outputs are illustrative estimates.