• Standard
Term Loan

Use this business loan repayments calculator for term loans (fixed term). Where the principle and interest is paid back as a fixed amount each month over a fixed term of years.

• ## Line of Credit Calculator

The business line of credit calculator will calculate the monthly interest and repayments your business will need to pay on any amount drawn from your line of credit (LOC) facility.

• ## Factor Rate to APR Calculator

Want to find out the APR (annual percentage rate) you're paying? If you've beeb quoted a factor rate, this business loan calculator will convert a factor rate into an APR for you.

• ## Merchant Cash Advance Calculator

Use our merchant cash advance calculator to calculate your daily repayment amounts as a percentage of future card sales.

## Calculating Small Business Loan Repayments

When borrowing money for your business it's important to understand the repayment structures of the various loan options. It can also affect how much you can borrow.

1
Standard business loans offered by banks use interest rates the are calculated on an annual percentage rate basis. They are repaid monthly over a period of years.
2
Unsecured business loan interest rates are calculated using a "factor rate". This is a very different interest calculation. Learn how to calculate using factor rates further below.

## Example Repayment Schedule

With traditional loans you will pay back both principal and interest each payment. Below we have illustrated an amortisation schedule for a business borrowing \$20,000 over 5 years at a 9% interest rate.

Year Beginning
Balance
Monthly
Repayment
Annual Interest
Paid
Annual Princial
Paid
Total Annual
Payment
Ending
Balance
1 \$20,000.00 \$483.33 \$1,800.00 \$4,000.00 \$5,800.00 \$16,000.00
2 \$16,000.00 \$453.33 \$1,440.00 \$4,000.00 \$5,440.00 \$12,000.00
3 \$12,000.00 \$423.33 \$1,080.00 \$4,000.00 \$5,080.00 \$8,000.00
4 \$8,000.00 \$393.33 \$720.00 \$4,000.00 \$4,720.00 \$4,000.00
5 \$4,000.00 \$363.33 \$360.00 \$4,000.00 \$4,360.00 Zero

#### Calculating the interest rates of unsecured business loans using a factor rate

Let’s say you borrow \$30,000 over 12 months at a factor rate of 1.35%

1.35 multiplied by \$30,000 totals \$40,500

On average there are 22 business days per month.

22 business days multiplied by 12 months is 264 days (payments)

\$40,500 divided by 264 equals \$153.41

\$153.41 is your daily repayment (excluding any fees and charges).

#### How much can I borrow?

Typically with unsecured business loans you’re going to be able to borrow up to 80% of free cash flow (what’s left after all your bills are paid).

With secured lending over a longer term you will be able to borrow greater sums of money especially if you securitise the business loan against your home or other assets.

It’s not just the interest rate you need to be aware of, you also want to consider all fees and charges associated with business loans.

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