Are you late in paying the due amount of your invoice? And worried about the late payment calculation? Then you have come to the right place. Hope this article will be a quick guide to make a late payment interest calculator in an Excel worksheet including a Free Template to download.
The above image is an overview of the late payment interest calculator.
Download the Calculator
You can download the free Excel template from here and practice on your own.
What is Late Payment Interest
The late payment interest is the extra amount of money that you will have to pay if you fail to pay the amount according to the contracted date while taking a loan or for an invoice with a selected interest rate.
- A very simple formula to calculate the late payment interest is:
Uses of Late Payment Interest Calculator
- The late payment interest calculator will help you to know your monthly interest amount.
- You will be able to know how much interest you’ll pay for different delayed dates.
- It will help you to manage your other plans according to your late payment.
How to Make a Late Payment Interest Calculator in Excel
To explore the steps, we’ll use the following dataset that represents some buyers’ invoice details like- their invoice dates, due amounts, contacted payment periods, contacted payment dates, and interest rates.
I have added two new columns to find the over-days and due interest.
Now let’s find the over days first.
- Activate Cell G5
- Type the following formula in it-
- Later, hit the Enter button to get the output.
We got the first buyers over days.
- To get the other buyers over days just drag down the Fill Handle icon over the cells G6:G9 to copy the formula.
All the over-days are now calculated. Now let’s go for the due interests using the formula mentioned above.
- In Cell I5 write the following formula–
- Then just press the Enter button.
And soon after, you will get the first buyers’ due interest.
- Finally, drag down the Fill Handle icon for the cells I6:I9 to get all the other due interests.
Then you will get all the buyers’ due interests.
Things to Remember
- Don’t forget to divide the day number by 365 because the interest rate is given in per year format.
- Make sure that the cells containing rates are in Percentage format.
I hope the procedures described above will be good enough to make a late payment interest calculator in an Excel worksheet. Feel free to ask any question in the comment section and please give me feedback.