All tools are free — no sign-up, no paywall. Know exactly what a loan costs before you sign. New: compare two loans side by side and see which one costs less over the full term. Check your affordability before applying — lenders use the 40% debt-to-income rule to approve or reject you. Understanding flat rate vs reducing balance interest can save you thousands. Read our guide in the Learn section. CRB listings can block your loan applications for up to 5 years. Learn how the CRB works and how to protect your credit record. All tools are free — no sign-up, no paywall. Know exactly what a loan costs before you sign. New: compare two loans side by side and see which one costs less over the full term. Check your affordability before applying — lenders use the 40% debt-to-income rule to approve or reject you. Understanding flat rate vs reducing balance interest can save you thousands. Read our guide in the Learn section. CRB listings can block your loan applications for up to 5 years. Learn how the CRB works and how to protect your credit record.

1 Terms

Financial Terms Glossary

Every loan term explained clearly, with real examples.

All A C D F G P R S T

R 1 term

Reducing Balance Interest

Interest calculated only on the remaining unpaid principal each month. As you pay down the loan, the interest charge decreases because you owe less.

This is fairer and cheaper than flat rate interest. Used by most banks and SACCOs in Kenya.

Example: Month 1: you owe KES 100,000, pay interest on KES 100,000. Month 6: you owe KES 55,000, pay interest only on KES 55,000. Your interest cost drops every month.