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calcthai.com · 0% Installment vs Cash Discount Calculator
Loans & instalments
0% Installment vs Cash Discount Calculator
Compare a 0% installment plan with a cash discount. Find the hidden annual interest in the installment, the monthly payment and the value of keeping your cash invested while you pay.
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Compare a 0% installment plan with a cash discount. Find the hidden annual interest in the installment, the monthly payment and the value of keeping your cash invested while you pay.
How it works
Cash price = full price × (1 − discount). Monthly installment = full price × (1 + fee) ÷ months, paid at each month-end. The hidden rate is the monthly i that makes installment × (1 − (1 + i)^−n) ÷ i equal the cash price, multiplied by 12 like the annual effective rate used in loan disclosures. The advantage discounts the installments at your savings return and subtracts that from the cash price.
Hand check: a THB 1,000 item, one installment, 2% cash discount. Pay THB 980 now or THB 1,000 after a month: monthly rate = 1,000 ÷ 980 − 1 = 2.0408%, or 24.49% a year. With no discount and no fee the hidden rate is 0%.
Assumes every installment is paid on time, starting at the end of the first month. Late payment can trigger interest and fees under your card terms. Points, cashback and unentered promotional terms are excluded, and the tool does not confirm what a shop or bank actually offers.
Frequently asked questions
Is 0% really interest-free?
If the installment total equals the cash price and there is no fee, it is interest-free. If cash earns a discount, choosing installments gives up that discount, which is a hidden cost that can be expressed as annual interest.
Why is the hidden rate high for short plans?
The same discount over a shorter time translates to a higher yearly rate. A 2% discount for one month is roughly 24% a year.
What savings return should I use?
Use what you would actually earn while paying, such as after-tax savings interest. If the cash would repay high-interest debt, use that debt's rate instead.
Sources
Method last verified 21 Sep 2026