MSME delayed payment interest calculator
Works out interest on a delayed payment to a micro or small enterprise under the MSMED Act, 2006: compound interest at three times the RBI bank rate.
- Applies to
- Udyam-registered micro and small contractors
- Rates
- Set per contract
- Last checked
- 10 November 2026
Inputs and result. Every rate is yours to set.
The amount accepted and payable to you.
Counted at most 45 days from acceptance.
5.75% is the rate used in this example. Enter the bank rate notified by the RBI.
Interest on delayed payment
₹60,745
- Due within45 days
- Days late45 days
- Interest rate, 3 x bank rate17.25% a year
- Months at monthly rests1.479
Rule applied. Under Sections 15 and 16 of the MSMED Act, 2006, a buyer must pay a micro or small enterprise within the agreed period, which may not exceed 45 days from acceptance. On a delay, interest is compound with monthly rests at three times the bank rate notified by the RBI.
Last checked 10 November 2026
The steps behind the figure
- Take the amount accepted and payable.
- Find the due date: the agreed period, at most 45 days from acceptance.
- Count the days from the due date to the date of payment.
- Apply compound interest with monthly rests at three times the RBI bank rate.
Slab S3 depth reads 150 mm. Drawing S-104 shows 125 mm. Please confirm.
Revised drawing S-104 R2, 14 Sept, attached with the measurement photo.
Who can claim this interest?
A micro or small enterprise registered under Udyam, on payments due from a buyer for goods or services supplied.
Where are delayed payment cases filed?
With the Micro and Small Enterprises Facilitation Council, through the MSME Samadhaan portal.
Why does the buyer care about paying on time?
From FY 2023-24, Section 43B(h) of the Income-tax Act, 1961 lets the buyer deduct a payment to a micro or small enterprise only when it is paid within the MSMED time limit.