Nepal Legal Interest Calculator
Compute statutory 10% per annum court judgment interest, commercial debt accruals, and decreed payout totals under the Muluki Civil Code 2074 for civil execution and contract disputes.
1. Judgment & Loan Principal
Enter the principal debt amount, decreed settlement, or contract default sum.
Total Statutory Interest Accrued
NPR 200,000
Computed at 10% p.a. over 2.00 years.
Statutory Interest Rules Under Nepal Civil Code 2074
The Muluki Civil Code 2074 (Section 478 and related provisions) established clear principles regarding lending rates and court execution interest.
10% Ceiling on Lending
In any private loan or transaction agreement, the annual interest rate cannot exceed 10% per annum. Any contractual rate above 10% is void and unenforceable.
Prohibition of Compound Interest
Capitalizing accrued interest into the principal (Sawa Ma Gabhne / Chakrabriddhi) is explicitly prohibited by law. Interest must always be computed on the original principal sum.
Total Interest Cap
Total recovered interest cannot exceed the principal amount itself, regardless of how many years the debt has remained outstanding (Damdupat principle).
How to Calculate Decreed Legal Interest in Nepal
Standard procedure applied by court execution officers (Tahasil Karyalaya) for calculating post-judgment interest.
Verify the Judgment Decree Date
Find the exact date the court pronounced the decree or the date debtor defaulted under the agreement.
Apply 10% Simple Interest Rate
Calculate simple interest at 10% per annum (I = P × 0.10 × Years). Do not compound unpaid interest into the principal.
Check Damdupat Ceiling
Ensure the total accumulated interest does not exceed 100% of the principal sum under Section 478(3).
Submit in Execution Application
Include the detailed interest statement with your Faisala Karyannayan (Decree Execution) petition before the District Court.
Questions About Nepal Legal Interest Rules
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