'interest-only' originates from Modern English as a compound of 'interest' and 'only'. 'interest' ultimately comes from Latin 'interesse', where 'inter-' meant 'between' and 'esse' meant 'to be'; 'only' comes from Old English 'ānlic', from 'ān' meaning 'one'.

'interest' entered English via Old French 'interest' from Latin 'interesse' and developed the financial sense 'payment for the use of money'; 'only' evolved from Old English 'ānlic' (from 'one' + '-like') to mean 'solely'. The compound 'interest-only' arose in modern English to label loans or payments where only interest is due.

Initially 'interest' could mean 'it matters' or more generally 'compensation/advantage', but it shifted toward the financial meaning 'payment for borrowed money'. 'Only' originally related to 'one' and later acquired the sense 'solely'. Combined, 'interest-only' now specifically means 'in which only interest is paid (no principal)'.