Calculator
MSME Delayed-Payment Interest Calculator
Under the MSMED Act, 2006, a buyer who pays a registered micro or small enterprise after the "appointed day" (45 days from acceptance if agreed in writing, 15 days by default) owes compound interest with monthly rests at three times the RBI-notified bank rate. This calculator applies that formula to your invoice date, acceptance date, agreed terms and payment status to estimate the deadline, the number of delayed days, and the statutory interest and total claim. It is an educational estimate, not a legal or tax computation — verify figures with your CA or the MSEFC before relying on them for a claim.
In shortMultiply the outstanding amount by the number of delayed days at three times the RBI bank rate, compounded monthly from the day after your 45-day (or 15-day default) deadline — use the calculator above for an exact estimate on your own dates.
Total value of the goods or services supplied.
When goods/services were delivered and accepted (or deemed accepted).
With no written agreement, the statutory default is 15 days.
As written in the PO/contract. The law caps this at 45 days regardless of what is written.
Leave at 0 if nothing has been paid yet.
Usually today, or the date you expect to be paid in full.
Advanced assumptions
RBI Bank Rate was 5.50% as of 19 July 2026 — check rbi.org.in for the current figure and edit if it has changed.
Outstanding principal vs statutory interest
- Outstanding principal₹5,00,00097%
- Statutory interest₹15,0223%
This estimate uses a 30-day-month convention for the monthly rests required by Section 16 of the MSMED Act; an MSEFC or court computation may use calendar months and could differ slightly. It also assumes the "appointed day" is not disputed — a genuine, timely written objection to the goods/services can shift this date. This is an educational estimate, not a legal or tax computation — verify with your CA or the MSEFC before relying on it for a claim.
What your result means
- If "days delayed" shows 0, the payment is on or before the statutory deadline — there is no interest claim yet, even if the buyer feels slow.
- A large gap between the "estimated total claim" and the outstanding principal usually means either a long delay or a high bank rate at the time — both are worth pointing out to the buyer in a reminder.
- If the agreed period you entered was capped down to 45 days, remember that cap is a floor for your claim, not a ceiling on what you can ask for informally — you can still negotiate, but the statutory entitlement does not go below it.
- A part-payment date close to the appointed day sharply reduces the interest on the remaining balance — this is why chasing even a partial payment early is worth doing rather than waiting for the full amount.
- Treat the total claim as a starting point for a conversation or a filing, not a final legal figure — an MSEFC, arbitrator, or your CA may compute the exact number differently.
How to use this calculator
- Enter the invoice amount and the date the goods/services were accepted (or delivered, if no written objection followed).
- Say whether a payment period was agreed in writing, and if so, how many days — the tool automatically caps this at the legal 45-day ceiling.
- If any amount has already been paid, enter it along with the date it was paid.
- Set "Calculate interest up to" to today's date, or the date you expect full payment.
- Check the RBI bank rate under "Advanced assumptions" and update it if it has changed since the figure shown.
- Read the appointed day, the days delayed, and the estimated interest and total claim.
The formula
Appointed day = acceptance date + 45 days (capped, if a written period is agreed) or + 15 days (default, if nothing is agreed in writing). Delayed days = calculation date − appointed day. Statutory interest = outstanding principal × [(1 + monthly rate)^months − 1], compounded monthly, where the monthly rate = (3 × RBI bank rate) ÷ 12. Total claim = outstanding principal + statutory interest.
Worked example
An invoice for ₹5,00,000 is accepted on 1 April 2026 with a written 45-day term, so the appointed day is 16 May 2026. If nothing is paid until 1 September 2026 (108 days late) and the RBI bank rate is 5.50% (statutory rate 16.50% p.a.), the calculator compounds monthly rests over roughly 3.6 months, producing an estimated interest of a little over ₹25,000 on top of the ₹5,00,000 principal — a real, statutory cost of treating a small supplier as free short-term credit.
Methodology
The calculator computes the "appointed day" from your acceptance date using Section 15 of the MSMED Act, 2006: 45 days from acceptance if a period is agreed in writing (the Act does not permit a longer agreed period, so anything higher is capped down to 45), or 15 days by default if nothing is agreed. Interest for the delay is computed under Section 16 — compound interest with monthly rests at three times the RBI-notified bank rate — using a 30-day-month convention to keep the monthly-rest math transparent. If you record a part-payment date, the tool splits the calculation into two segments: full principal until the part-payment, and the remaining balance after it.
Why results differ across calculators
- Some tools use calendar months (28–31 days) for monthly rests instead of a flat 30-day convention, which shifts the compounding slightly.
- The bank rate changes when the RBI revises it at a bi-monthly monetary policy review — a stale rate produces a stale answer.
- A genuine, timely written objection to the goods/services can move the "day of acceptance" itself, changing the appointed day.
- Some calculators (incorrectly) apply simple interest or a non-compounding formula, understating the amount actually owed under the Act.
When to use it
- Estimating what a late-paying buyer actually owes before sending a payment reminder or demand notice.
- Deciding whether pursuing an ODR/MSEFC claim is worth the effort on a specific invoice.
- Checking whether a buyer's settlement offer covers the statutory interest, not just the principal.
- Understanding, before agreeing to a "90-day" purchase order, why that term will not hold up under the MSMED Act.