Equivalent Compound Rate
সমতুল্য চক্রবৃদ্ধি হার
Turn a flat earning rate (or a profit amount) into its equivalent annual compound rate, so you can compare offers on an even footing.
Assumptions used
- The flat rate is the total return over the entire period — not an annual figure.
- Profit is assumed to compound monthly when deriving the equivalent rate.
- Duration is converted to months internally.
Good to know
Why convert a flat rate to a compound rate?
Sellers and informal lenders often quote a flat return (e.g. ‘33% over 18 months’). Converting it to an equivalent annual compound rate lets you compare it fairly against bank, FD or DPS rates that are quoted per year.
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OpenFrequently asked questions
What does ‘equivalent compound rate’ mean?
It is the annual compound interest rate that would produce the same final amount as the flat return you entered over the same period. It makes a flat quote comparable to annual bank rates.
Why is the compound rate different from the flat rate?
A flat rate ignores the timing of returns. Once you account for compounding over the period, the equivalent annual rate is usually different — often lower than a headline flat figure for periods longer than a year.
Results are estimates for general guidance only and are not financial advice. Rates, tax rules and product terms change — always confirm the latest figures with your bank or Bangladesh Bank / National Savings before making a decision.