Business loan calculator.

What would this loan mean for your cash flow?

Compare the monthly payment with cash left after operating costs and existing debt payments. Check the total paid as well: a longer term can reduce the instalment while keeping you in debt for longer. Enter the amount you intend to borrow, rather than the full project budget if you are contributing cash.

Understand the assumptions.

This calculator uses a constant nominal annual interest rate, monthly compounding and equal monthly payments at the end of each month. The fee shown is paid upfront, separately from the loan.

The business loan scenario fully repays the principal over the term and has no final balloon. Use the equipment calculator if you want to model a balloon.

It excludes ongoing fees, changes in rate, taxes, variable payment schedules and lender-specific calculation conventions. Values are rounded for display, so an actual payment schedule may differ.

Worked example: $100,000 over three, five and seven years.

The table uses a $100,000 business loan at an illustrative 12% p.a., repaid monthly with no balloon. The rate is a placeholder for the calculation, not a market rate or an offer.

Stretching the term from three to seven years cuts the monthly repayment by about $1,556 but adds about $28,700 of interest. Neither term is right or wrong: the question is whether the business needs the lower repayment to keep operating cash safe, or whether it can afford the higher repayment and finish sooner. Run both cases through the debt-service headroom calculator to see which one the cash supports.

Rate, fees and payment frequency all change the answer.

Rate convention. Most Australian business loan quotes state an annual percentage rate, but some short-term lenders quote a simple factor rate, for example 1.2 on the amount borrowed. A factor rate is not an annual rate and usually works out far higher when converted. Enter only an annual percentage rate here, and use the loan comparison tool for quotes that are expressed differently.

Fees. An establishment fee paid at settlement is shown separately in this calculator. A $995 fee on a $100,000 loan adds about one per cent to the cost of the money before interest. Ongoing monthly or annual fees are not modelled; add them to the repayment when you test cash flow.

Frequency. Weekly and fortnightly repayments are common. Convert with 52 weeks or 26 fortnights a year, never by dividing the monthly figure by four or two. A monthly repayment of $2,224 is roughly $513 a week or $1,027 a fortnight before any timing adjustment.