IPMT

The IPMT function calculates the amount of interest to be paid on a loan where the interest payments and timing of payments are consistent.

Syntax

IPMT(Rate, Per, Nper, PV,FV?,Type?) - > Number

Arguments

Arguments	Datatype	Description
Rate	Number	The interest rate per period
Per	Number	The period for which you want to find the interest. It must be in the range of 1 and the total number of periods.
Nper	Number	The total number of periods
PV	Number, Node name	The present value or initial investment. Cash outflows are considered as negative and cash inflows are positive.
FV?	Number, Node name	The future or residual value. This is an optional argument and if omitted, it is considered to be zero
Type?	Number	Indicates when the payments are made. Type is zero if payments are made at the end of the period and 1 if the payments are made at the start of the period.

Example

Consider a $10,000 loan at an annual rate of 10% that is to be paid off in 1.5 years. All payments are made at the beginning of the month.

Periods	1	2	3	4	5	6	7	8	9	10	11	12	13	14	15	16	17	18
Number of periods	18	18	18	18	18	18	18	18	18	18	18	18	18	18	18	18	18	18
Loan Amount	10000	10000	10000	10000	10000	10000	10000	10000	10000	10000	10000	10000	10000	10000	10000	10000	10000	10000
Type	1	1	1	1	1	1	1	1	1	1	1	1	1	1	1	1	1	1
Period	1	2	3	4	5	6	7	8	9	10	11	12	13	14	15	16	17	18
Rate	10%	10%	10%	10%

To calculate the interest payments the following formula should be written in the IPMT node:

IPMT([Rate]/12, [Period], [Number of periods], [Loan Amount],0,1)

Result

IPMT

₹ 0.00

₹ -78.37

₹ -74.06

₹ -69.71

₹ -65.33

₹ -60.91

₹ -56.46

₹ -51.96

₹ -47.43

₹ -42.86

₹ -38.26

₹ -33.61

₹ -28.93

₹ -24.21

₹ -19.45

₹ -14.65

₹ -9.80

₹ -4.92

The interest payments for Period 1 is 0 as the payment is made at beginning of the month. Note the decrease in interest amount as the principal amount will be repaid gradually.