Business loan comparison calculator

What this calculator does

Two business loans can advertise very different headline rates yet cost almost the same — or look identical on rate and differ by thousands of pounds once term and fees are counted. This calculator puts each offer into the same frame so you compare like with like.

For every option you enter, it works out the monthly repayment, the total amount repayable over the full term, the total cost of credit (everything you pay on top of the amount borrowed) and an indicative annual cost expressed as a percentage. It then ranks them, so the cheapest offer in real money is obvious at a glance rather than buried in a quote letter.

It is built for UK limited-company directors and finance teams weighing up working-capital offers. Figures are illustrative and do not represent a Credicorp quote.

How to use it

Enter each offer as a row: the amount you'd draw, the interest rate or fee quoted, the term in months, and any arrangement or set-up fee. Add a second (or third) offer and the tool lines them up.

• Use the same amount across offers where you can — comparing a £30,000 facility against a £50,000 one tells you little.
• Include every fee the lender mentions: arrangement, documentation, and any early-settlement charge if you intend to repay early.
• Match the term to the actual money. A longer term lowers the monthly figure but usually raises the total cost.

The result updates as you type. Look past the lowest monthly payment to the lowest total cost of credit — that is the number that leaves your business with more cash.

How to read the result

You'll see four numbers per offer. Monthly repayment is what leaves your account each month — it drives cash flow but is the easiest figure to be misled by, because stretching the term shrinks it while quietly inflating the total. Total repayable is every payment added up. Total cost of credit strips out the amount you borrowed, leaving only what the finance itself costs — the cleanest single comparison number. The indicative annual cost restates that as a percentage so offers on different terms can be compared fairly.

A short-term facility can show a higher percentage but a far lower cost in pounds, simply because you hold the money for less time. For working capital, the pounds figure usually matters more than the headline rate.

The formula in plain English

For each offer the calculator does three things. First it spreads the loan into equal monthly instalments using standard amortisation — the same maths a bank uses — so each payment covers interest on the outstanding balance plus a slice of the capital. Second, it adds up every instalment to get the total repayable, then adds any arrangement fee. Third, it subtracts the original amount borrowed to isolate the total cost of credit.

Total cost of credit = (monthly repayment × number of months) + fees − amount borrowed

The indicative annual percentage annualises that cost against the amount and term, giving a like-for-like rate. Because flat-rate and per-month quotes can hide the true figure, converting everything to a total in pounds is the safest way to compare.

Worked example

Suppose you need £40,000 of working capital and hold two offers.

Offer	Rate / fee	Term	Arrangement fee	Total cost
A	9% APR	36 months	£600	~£6,400
B	6% flat per year	24 months	£0	~£4,800

Offer A looks reasonable on rate, but Offer B — despite a lower headline number being harder to read on a flat basis — costs around £1,600 less in total because the money is held for a shorter period and there's no fee. The monthly payment on B is higher, so it only suits you if the cash flow supports it. This is exactly the trade-off the calculator surfaces.

Limitations to keep in mind

This is an indicative tool, not a credit decision. It assumes equal monthly repayments and a fixed rate for the full term; revolving facilities such as Credicorp Flex, where you draw and repay flexibly and only pay for what you use, won't map neatly onto a fixed-instalment comparison. It also can't capture covenants, security requirements, speed of funding, or whether a personal guarantee is required — Credicorp lends to the limited company without one, which is a real but non-numeric difference between offers.

Always check each lender's own quote and terms before deciding. When you're ready to model a single offer in depth, use the true cost of borrowing calculator. This page is educational and is not financial advice.