Business Loan Calculator

Use our free business loan calculator to estimate interest rates and
monthly payments for financing your business. Calculate business loan
affordability and make Smarter business decisions.

Utilize our free business loan calculator to ascertain interest rates on loans and calculate monthly payments crucial for financing your venture. This tool aids in making enlightened small business loan decisions by calculating business loan affordability.

When on the journey to borrow funds for business purposes, a myriad of lenders and terms will present themselves. Varied lenders furnish different small business financing products, each with distinct terms and interest rates. Thankfully, the need to meticulously sift through these by yourself is obviated with our small business loan calculator here.

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This tool provides an estimate of interest rates and scheduled payments for a small business loan, offering a glimpse into the total cost of business financing should you opt to proceed with a small business loan application yourself.

To harness our small business loan calculator below, merely populate the fields below, and the next loan calculator below will divulge how much a loan may cost your business.

Business Loan Calculator

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"Below you will find a detailed breakdown of your payments in each month and each year. Find out how much interest, principal and total you'll be paying with the information you entered. Change your term length, interest rate and loan amount to see how it impacts your payment breakdown."

Understanding your small business loans calculations

Several pivotal factors dictate the cost of a small business loan amount. Typically, lenders scrutinize the duration your business has been operational and your monthly sales volumes, among other elements, to gauge the risk entailed in extending a loan.

With this data, they discern how “risky” the small business loan application would be. The loftier the risk, the lesser the loan amount a business owner will qualify for, and the higher the interest rate will soar.

Conversely, lower risk translates to lower interest rates.

Here are some key terms to familiarize yourself with when computing total costs of the cost of a bank or business loan:

Monthly Payments

This monthly payment denotes the aggregate amount requisite your business loans to be paid each month. The terms of the business loan heavily influence your monthly payments on personal loans.

Opting for a business loan with short term loans over a protracted loan or short term loans, usually results in lower monthly payments.

This encapsulates the expected total cost of your business equipment loan, inclusive of all ancillary costs of equipment loan like annual interest rate and any pertinent fees linked with the business loan calculator.

Total Cost of Loan

This encapsulates the expected total cost of your business equipment loan, inclusive of all ancillary costs of equipment loan like annual interest rate and any pertinent fees linked with the business loan calculator.

Payment Details

The Monthly Payment and Details table delineates all your payments over the term of your business loan, illustrating the total principal and interest amounts to be repaid each year throughout your loan term. It’s prudent to confer with your lender if any loan terms appear ambiguous.

Furthermore, when seeking a business loan, it’s advantageous to explore various lending and financial institutions. Larger banks might offer a semblance of trust and stability, yet smaller banks often furnish more personalized service and may have a better understanding of the local market conditions. Engaging with multiple banks can provide a broader perspective on the available loan products and potentially better terms.

It’s also noteworthy that banks may require a thorough examination of your financial health, including a review of tax returns, to gauge the risk associated with the loan. This scrutiny aids in determining the loan terms including the rates of interest.

Hence, having a clear and precise understanding of your loans’ terms and conditions from the outset, as outlined in the Payment and Details table, can foster a smoother interaction with banks and potentially lead to more favourable loan conditions.

The APR you pay embodies the total annual cost to pay back of your personal loan. For instance, procuring a $100,000 loan for a year at 10% of interest only necessitates a payback amount of $110,000 once the year elapses.

The APR you pay on a business loan is contingent on your credit score and business financials.


The APR you pay embodies the total annual cost to pay back of your personal loan. For instance, procuring a $100,000 loan for a year at 10% of interest only necessitates a payback amount of $110,000 once the year elapses.

The APR you pay on a business loan is contingent on your credit score and business financials.

Qualifying for a Business Loan

Securing a business loan from most banks necessitates meeting certain criteria:

  • Credit Score: A robust personal credit score can enhance loan approval chances and potentially secure low-interest rates.
  • Business Financials: Lenders often scrutinize financial statements to assess a business’s financial health. Solid financials can pave the way for favourable loan terms.
  • Loan Application: A comprehensive application, inclusive of a business plan, financial projections, and a clear articulation of the financing needs, can significantly bolster the loan request.

Loan Calculation Insights

Understanding how small business loans really are calculated can demystify the lending process, allowing small business’ owners to make informed financial decisions again. Here’s a breakdown:

  • Interest Rates and Monthly Payments: The interest rate, either fixed or variable, impacts your monthly payments. Utilizing a business loan calculator can help project these payments over the loan term, providing a glimpse into the loan’s affordability and how it impacts cash flow.
  • Total Interest and Loan’s Actual Cost: Beyond the principal, interest constitutes a significant portion of the loan’s actual cost. A loan calculator can help discern the total interest payable over the term, unveiling the loan’s actual cost.
  • Monthly Amortization Schedule: This schedule breaks down each monthly payment into principal and interest components, showcasing how the loan balance diminishes over time.

Conventional Loans:

Unlike SBA loans, conventional loans are not government-backed loans and might have higher rates of interest. However, they offer banks more flexibility in terms.

Loan Amount:

This loan request is the initial amount of money borrowed from a lender. The initial loan amount, alongside the interest rate and loan duration, influences the scheduled payments and total cost of the loan.

SBA Loans:

Offered by lenders and backed by the Small Business Administration, these loans can offer lower rates of interest and longer terms, making them a sought-after option for small businesses.

Loan Term:

The loan term is the duration over which total interest on the loan will be repaid; short-term loans are in interest-only payments. Longer terms might result in lower scheduled payments but could accrue more interest over time, impacting the loan’s actual cost.

Interest Rate and Annual Interest Rate:

The interest rate is the cost of borrowing money, usually expressed as a percentage of the loan amount. The annual interest rate is the interest rate for a whole year, as opposed to monthly or daily rates or interest-only payments.

Business Loan and Small Business Loan:

These loans provide the working capital needed for a business to flourish.

The distinction primarily with conventional loans lies in the initial loan amount amount, with small business loans typically being of a lower amount compared to standard business loans.

Delving into Loan Terminology

Embarking on the quest for a business loan, be it a small business loan or a more substantial amount, entails navigating through a sea of terminology.

Grasping these terms is paramount to making informed financial decisions.

Business Loans in Canada

The landscape of business loans and personal loans here in Canada mirrors many global standards, albeit with some unique offerings:

  • Loan Amounts: The loan amount a business can secure varies widely, contingent on various factors like business financials, credit history, and the lender.
  • Interest Rates: A good interest rate for a business loan in Canada hinges on numerous factors, including the lender, credit rating, and the overall economic climate.
  • Government Support: The Canadian government, through initiatives like the Canada Small Business Financing Program, facilitates access to capital for small businesses.

Making Informed Decisions

Financial literacy is paramount in navigating the complex realm of credit unions, financial institutions, personal loans and small business administration and financing:

  • Financial Planning: Engaging in meticulous finance planning, inclusive of analyzing cash flow, expenses, and financial projections, can equip businesses to make enlightened decisions regarding loan procurement.
  • Consultation: Consulting with financial advisors or lenders can provide personalized insights, aiding in the alignment of financing solutions with business goals.

Navigating the realm of business loans and working capital can be intricate. However, armed with the right tools like a business loan calculator, and a solid grasp of loan terminology and calculations working capital used, business owners can make informed decisions about financial institutions that propel their ventures forward. Utilizing available resources, engaging in thorough finance planning, and seeking professional advice can significantly mitigate the challenges associated with securing business financing and working capital.

This comprehensive exploration into small business loans further illuminates the path for economic development for small business administration and owners, aiding in economic development and the discernment of viable financing solutions new businesses that align with their business aspirations and financial capacities.


What factors to consider when shopping for a business loan?

When you’re making your final decision, there are some other factors also worth considering that may go beyond what you’ll find on our small business loan calculator. Look for and pay close attention to:

The loan’s terms
Pay close attention to the terms of the loan. They determine your repayment expenses. Longer terms can offer you more flexibility, but they often mean a higher total cost of borrowing.

Pay close attention to the loan agreement and ask questions until you are certain you fully understand all fees that your loan comes with. For example, you can ask if the loan comes with an application fee, “origination fee” or an “administrative fee”.

Will the lender charge an extra fee for NSFs? There may also be a fee applied if you decide to make monthly repayments on your loan too early. Consider these costs when determining the full cost of a business loan.

Repayment structure
Different financing products are repaid differently. For example, a typical term loan has the same fixed monthly payment frequency and repayment amount. However, a Merchant Cash Advance works differently, where the loan is repaid daily, based on the percentage of sales for that day, which means you’ll repay more when you sell more, and less when you sell less. Utilize a product that fits your business model and industry.

What is the average interest rate for a small business?

Your rates will depend on your credit rating and your business’s financial information, such as your monthly sales volume. If you have a good credit history and apply for a loan from traditional lenders (banks, credit unions) you may expect the APR to be 4%-12%.

With alternative online lenders, the annual percentage rate may be 15% and higher, because their qualification requirements are more relaxed and they charge extra for taking on more risk.

Check out our comparison of the best business loan lenders to find the right solution for your business.

How do I qualify for a business loan online?

Getting a business loan online is very easy and you can do it entirely online. You’ll need to provide paperwork such as your business registration documents and bank statements. There may be other things a lender will ask of you.

Once you submit your application, most online business lenders will get back to you with a decision almost instantly. You may also be eligible for government grants, so make sure to research those options for your business.

How can I get a business loan online?

Below you will find a list of online business loan providers that can get you business financing in as little as 24-48 hours. These lenders have been carefully verified and selected by Smarter Loans and are some of the most reputable financial companies in Canada.

Click Apply Now next to a top bank or company of banks of your choice, or select any of the other lenders below to visit their bank profile and learn more about their business plan specific products.

How much can you get for a business loan in Canada?

The amount you can secure through a business loan in Canada varies based on several factors including your credit rating, business financials, expenses and the lender’s terms.

It could range from a few thousand to several million dollars. It’s advisable to consult with multiple lenders to understand the amount you are eligible for.

What is a good interest rate for a business loan?

A good interest rate for a business loan varies depending on various factors including your credit rating, the economy, and lender terms. As of the last update, typical business loan interest rates range from 2% to 10%. However, rates can be higher for riskier businesses or lower if secured by collateral.

How much can you pull out for a business loan?

The amount you can pull out for a business loan depends on many businesses: your business’s financial health, your credit score, and the lender’s terms.

Evaluate your repayment capacity and the business’s cash flow and financing needs before deciding on the loan amount.

How do I qualify for a small business loan?

To qualify for a small business loan, you generally need to have a good credit score, a solid business plan, positive financial statements, and sometimes collateral to provide personal back.

Meeting with a financial advisor or lender can provide personalized advice based on your circumstances.

Is a business loan paid monthly?

Yes, business loans are typically all loans repaid in monthly installments, which include both principal and interest. However, the full monthly repayments and payment frequency may vary with different lenders and loan types, so it’s advisable to confirm the repayment schedule with your lender.

How to calculate how much loan you can get for business loans?

The loan amount you can secure for your business invoice financing varies based on your personal credit score, business financials, and the lending institution.

It’s advisable to consult with multiple lenders to understand the maximum amount of invoice financing you are eligible for.

How do you calculate what a loan payment will be using a small business loan calculator?

Loan contributions can be calculated using the formula shared above or by using a business loan calculator, which requires you to input the principal amount, interest rate, and loan term to estimate your monthly contributions.

In addition to the formula and calculator method, consulting with a bank can provide a more personalized insight into your loan payment structure. Banks often have loan officers who can help calculate the monthly payment on loans, taking into account various factors that might affect your repayment schedule.

For instance, SBA loans, which are partially guaranteed by the Small Business Administration, may have different terms and conditions compared to conventional bank loans. The nature of SBA loans, being designed to assist small businesses in obtaining necessary funding, often translates into more favourable terms for borrowers. Furthermore, the backing of the SBA often provides banks with a level of assurance, which can translate to lower rates of interest in pay and more flexible repayment terms. The process of applying for SBA loans can be somewhat more involved due to the additional layer of scrutiny from the SBA, but the benefits often outweigh the extra effort.

It’s advisable for business owners to compare the terms of SBA loans and conventional bank loans to determine which financing option aligns better with their business needs and financial capacity. The unique structure of SBA loans, with the involvement of the SBA often makes them a more attractive option for small businesses seeking to secure funding while minimizing costs.

Calculate in advance utilizing a business loan calculator before your consultation. Get a preliminary understanding, enabling a more informed discussion with the loan officer. Calculate monthly payment, interest rate, and total cost of the loan for cash flow planning and ensuring that you can pay back the loan as per the agreement.