What do you call an extra amount of money paid back with a loan as a charge borrowing?

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2026-03-03 09:05

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The extra amount of money paid back with a loan as a charge for borrowing is called "interest." Interest is typically expressed as a percentage of the principal amount borrowed and compensates the lender for the risk and opportunity cost of lending the money. It can be calculated in various ways, including simple or compound interest, depending on the loan terms.

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