Percent or percentage points: the difference
When a rate goes from 10% to 12%, it gains 2 percentage points, but it rises by 20%. Points measure the gap between two percentages; percent measures the change relative to the start.
Updated November 6, 2026 · Sources
Two measures of the same change
The gap in points is a simple subtraction: 12 − 10 = 2 points. The relative change divides that gap by the starting value: 2 ÷ 10 = 20%.
An interest rate going from 4% to 5% gains 1 point, but rises by 25%: for the same balance, so does the interest you pay.
| Rate | Gap in points | Relative change |
|---|---|---|
| 2 % → 3 % | 1 | 50 % |
| 4 % → 5 % | 1 | 25 % |
| 10 % → 12 % | 2 | 20 % |
| 20 % → 15 % | -5 | -25 % |
| 50 % → 60 % | 10 | 20 % |
A rise then a fall do not cancel out
A price of 100 that rises 50% becomes 150. If it then falls 50%, it drops to 75, not 100: the fall applies to a bigger base. Overall, it lost 25%.
Successive rises multiply
Two 10% rises do not make 20%, but 21%: you multiply by 1.1 twice. It is the same mechanism as compound interest.
The % sign is just a number
The % sign simply stands for the number 0.01: 25% = 0.25. That is why “50% more” and “50 points more” give different results: starting from 10%, you reach 15% in the first case and 60% in the second.