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Effective Interest Rate Calculator
Convert nominal rate to effective rate (EAR).
Enter values to see your result
Frequently asked questions
EAR vs APR vs APY?
APR = borrower's nominal cost incl fees. APY = lender's effective yield (same as EAR for savings). EAR = compounding-adjusted rate.
When does EAR matter most?
Comparing products with different compounding schedules. A 9.5% monthly-compound FD beats a 9.6% annual-compound bond. Different timeline = misleading comparison.
Quarterly vs monthly?
At 10%: Quarterly EAR = 10.38%, Monthly = 10.47%. Small edge. Daily = 10.52%. Difference shrinks at higher frequencies.
Is monthly EMI compounded monthly?
Yes — Indian home loan EMI math uses monthly compounding. That's why "9% home loan" has EAR of ~9.38%.