Flat vs Reducing Rate Calculator
Convert flat interest rates to reducing balance equivalent. Reveal the hidden cost of NBFC and car dealer loan offers.
Quick Summary: Flat vs Reducing Rate Calculator
A flat interest rate is calculated on the full original principal for the entire tenure, whereas a reducing rate is calculated only on the remaining balance. A 10% flat rate is mathematically equivalent to approximately 17.3% reducing rate for a 5-year tenure. Always ask for the reducing rate equivalent (APR) to compare loan offers fairly.
How to use the Flat vs Reducing Rate Calculator
- 1
Enter Flat Rate
Input the percentage rate quoted by the dealer or lender.
- 2
Set Tenure
Specify the number of months the loan will run.
- 3
Review Reducing Equivalent
The tool computes the actual APR you are paying.
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Regulatory Disclaimer
Last verified May 2026
Nature:Calculator platform and is NOT a SEBI-registered Investment Adviser. All calculations are indicative.
Risk:"Investments in securities market are subject to market risks. Read all related documents carefully before investing."
Consult a SEBI-registered IA or CA for personalised advice.
9 out of 10 traders in F&O incurred net losses (SEBI 2023). Tax estimates based on IT Act 2025. Trezoriq is not liable for financial decisions based on results.