Freelancer & Business

Late-payment interest & reminder

Enter the invoice amount, due date and interest rate. See what late payment has cost and copy a ready-to-send reminder in a friendly, firm or final tone.

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The invoice

Amount overdue

Currency

Due date

Calculate interest up to

Grace period (days)

Invoice number (optional)

Interest

Annual interest rate (%)

Use the rate in your contract or invoice terms.

Method

Interest on overdue business payments depends on your contract and the law. For an MSME supplier, section 16 of the MSMED Act, 2006 provides compound interest with monthly rests at three times the RBI bank rate. This tool does not know the current bank rate. Enter three times the rate you read on rbi.org.in. General information, not legal advice.

The reminder

Tone

Client name

Your name

Payment details (UPI, bank), optional

Reminder text (you can edit it)

Interest so far

₹0.00

Days overdue: 0
Amount overdue
Interest per day (at the start)
Total now due

Template and estimate only, not legal or tax advice. Requirements differ by country, state and situation. Have a qualified professional check the wording, rates and numbers before you rely on, send or sign it.

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How the interest is calculated

Simple interest = amount x rate x days overdue / (100 x 365)
Compound (monthly rests): amount x (1 + rate / 1200)^months, then simple interest for the leftover days
Interest = total with interest - amount

Days overdue are counted from the due date plus any grace period up to the date you choose. For monthly compounding, full calendar months are counted from the start date and each month adds one twelfth of the annual rate to the balance. The leftover days earn simple interest on that balance. Amounts are held in paise and rounded once, at the end.

The reminder text includes the interest and the total in words only for the firm and final tones, because a friendly nudge does not need to mention interest.

Frequently asked questions

Can I charge interest if my invoice does not mention it?

It depends on your contract, your trade and the law. Written terms that state the rate and the due date make a claim much easier. Ask a lawyer or CA about your case. This tool only does the arithmetic.

What is the MSMED Act rule?

For micro and small enterprises, section 16 of the MSMED Act, 2006 provides compound interest with monthly rests at three times the RBI bank rate on delayed payments from buyers. Check the current bank rate on the RBI website and enter three times that rate here.

Simple or compound interest?

Use whatever your contract says. If it says nothing, simple interest is the usual, more conservative choice.

Is anything uploaded?

No. The sums and the letter are built in your browser.