Business loan repayment calculator

How the calculation works

Repayments are equal monthly instalments at the APR you enter, treated as an effective annual rate. The arrangement fee is either taken from the advance, which reduces the cash you receive, or added to the total you repay.

Monthly payment = P × i ÷ (1 − (1 + i)^−n), where i = (1 + APR)^(1/12) − 1 and n is the number of months

The effective yearly rate including the fee compares the cash you receive with everything you repay, so loans with different fees can be compared fairly.

Questions, answered

How do I calculate business loan repayments?

Convert the annual rate into a monthly rate, then use the amortisation formula above with the amount and the number of months. The calculator does it for you and shows the schedule.

Why is the cash I receive lower than the loan amount?

Many lenders take an arrangement fee from the advance. If you borrow £50,000 with a 2% fee taken up front, £49,000 reaches your account but you repay the full £50,000 plus interest.

Is the APR the whole cost?

Not always. Business lenders are not required to quote an APR, and fees, early-settlement charges and repayment frequency all change the real cost. That is why we show the cash received and the total repaid.

An illustration from the figures you enter, not a quote or advice. A provider’s offer depends on its assessment of your business.