Types of Interest n Simple Interest Interest paid (earned on only the original amount, or principal borrowed(lent) o Compound Interest Interest paid (earned)on any previous interest earned. as well as on the principal borrowed (lent) 3-53-5 Types of Interest Compound Interest Interest paid (earned) on any previous interest earned, as well as on the principal borrowed (lent). Simple Interest Interest paid (earned) on only the original amount, or principal borrowed (lent)