Business Loan Repayment Calculator

Last updated: April 2026

Loan Details

Repayment type

Loan amount

Annual interest rate

Enter the annual interest rate quoted by your lender. Typical UK SME loan rates range from 6%-25% depending on credit profile and lender.

Loan term

Most SME loans are 1-5 years. Property-backed loans can be longer.

Years

Months

Include arrangement fee?

Many lenders charge an arrangement fee of 1%-3% of the loan amount. Including this gives you the true cost of borrowing.

Monthly repayment£1,566.82

Total repayable£56,405.46

Total interest£6,405.46

Total cost of borrowing£6,405.46

Effective APR4.27%

Cost Visualisation

Loan amount£50,000.00

Total interest£6,405.46

Rate Comparison

RateMonthlyTotal Interest

6% £1,521.10£4,759.49

8% current£1,566.82£6,405.46

10% £1,613.36£8,080.94

12% £1,660.72£9,785.76

15% £1,733.27£12,397.59

To service this loan your business needs monthly revenue of at least £4,700.46 assuming 33% of revenue is available for debt service.

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How are business loan repayments calculated?

Business loan repayments are typically calculated using standard amortisation. Each monthly payment covers the interest due on the outstanding balance plus a portion of the capital. Early payments are predominantly interest; later payments are predominantly capital. Interest-only loans work differently: you pay only the interest each month and repay the full capital at the end of the term.

What is a typical interest rate for a UK business loan?

Interest rates on UK SME loans typically range from 6% to 25% per year depending on the lender, loan size, trading history, and your business credit profile. High street banks tend to offer lower rates but are harder to qualify for. Alternative lenders are more accessible but charge higher rates. Always compare the APR rather than the headline rate, as arrangement fees can significantly increase the true cost.

What is an arrangement fee?

An arrangement fee is a one-off charge by the lender for setting up the loan. It is typically 1%-3% of the loan amount and is either paid upfront or added to the loan balance. Adding the fee to the loan means you pay interest on it for the full term, increasing the total cost. Always factor the arrangement fee into your cost comparison.

What is the difference between APR and interest rate?

The interest rate is the annual cost of the loan as a percentage of the outstanding balance. The APR, or Annual Percentage Rate, includes all mandatory costs including arrangement fees and is a better measure of the true cost of borrowing. When comparing loans from different lenders, always compare APRs rather than headline interest rates.

Can I repay a business loan early?

Most business loans allow early repayment, but many lenders charge an early repayment fee, typically 1-6 months of interest. Check your loan agreement before making overpayments. Our Early Repayment Cost Calculator can help you assess the cost of settling early.