Use this free BPS calculator to convert basis points to percentage and decimal rates, or to calculate rate changes in basis points. It is useful for comparing interest rates, bond yields, mortgage pricing, and fee changes in a precise way.
Basis Points Converter
Enter one value below, then click the matching conversion button.
Rate Change in BPS
Find the basis point move between two rates in percent.
What Is a Basis Point?
A basis point (abbreviated as bps or bp) is a unit used in finance to describe small changes in rates. One basis point equals one-hundredth of one percentage point:
- 1 bps = 0.01%
- 100 bps = 1.00%
- 25 bps = 0.25%
Because percentage changes can be misread, professionals often use basis points to avoid confusion. Saying “rates increased by 50 bps” is very clear and unambiguous.
Quick Conversion Reference
| Basis Points | Percent | Decimal |
|---|---|---|
| 1 | 0.01% | 0.0001 |
| 10 | 0.10% | 0.0010 |
| 25 | 0.25% | 0.0025 |
| 100 | 1.00% | 0.0100 |
How to Calculate BPS
1) Convert Basis Points to Percent
Percent = BPS ÷ 100
Example: 75 bps = 75 ÷ 100 = 0.75%
2) Convert Percent to Basis Points
BPS = Percent × 100
Example: 1.20% = 120 bps
3) Convert Basis Points to Decimal
Decimal = BPS ÷ 10,000
Example: 40 bps = 0.0040
4) Find Change Between Two Rates
BPS change = (New rate − Old rate) × 100
Example: from 5.10% to 5.35% is a +25 bps move.
Where BPS Is Commonly Used
- Central bank policy: “The policy rate was cut by 25 bps.”
- Bond yields: Treasury yields may rise or fall a few bps in a day.
- Mortgages and loans: Lenders price spreads in basis points.
- Investment fees: Expense ratios are often discussed in bps.
- Credit spreads: Corporate debt risk is tracked in bps over benchmarks.
Why This Matters
Small rate differences can lead to meaningful money over time. A 20 bps improvement on a large loan or portfolio can materially affect monthly payments, annual returns, or borrowing costs. This is why traders, analysts, and borrowers regularly use basis points for precision.
FAQ
Is 100 bps always equal to 1%?
Yes. By definition, 100 basis points equals exactly 1 percentage point.
What does a 5 bps move mean?
It means a 0.05% change in the rate.
Can basis points be negative?
Yes. If a rate decreases, the change can be shown as negative bps (for example, -15 bps).