Free Tool
Business Loan Repayment Calculator
A loan’s monthly payment is not its cost: the interest over the full term is. This calculator shows the payment, the total interest and the balance year by year.
Planning estimate, not financial advice. All figures on this page are estimates or scenarios for planning purposes only, built from the numbers you enter. They are not financial, tax or legal advice, and no earnings are promised. Read the full financial disclaimer.
What this tool does
Enter the principal, the annual interest rate and the term in months. The calculator returns the fixed monthly payment, the total interest over the term and the total paid — plus the balance at the end of each year, so the cost of a longer term is visible instead of hidden in a smaller payment.
The trap is the term. A longer term cuts the monthly payment and raises the total interest, sometimes by more than the loan itself. Comparing two terms side by side on total interest — not on the monthly figure — is the honest comparison.
Try it
Waiting. Enter the loan amount, annual rate and term, then press Calculate.
How it works
The monthly payment is the standard amortisation formula: principal multiplied by the monthly rate, divided by one minus one plus the monthly rate to the power of negative months. The monthly rate is the annual rate divided by twelve. Total paid is the payment times the term, and total interest is total paid minus principal.
The yearly balances come from the same schedule: each month’s interest is the balance times the monthly rate, the rest of the payment reduces the balance, and the balance is reported at each twelve-month mark.
Assumptions and limitations
This is a planning figure for a fixed-rate loan, not a lending decision.
- The rate is fixed for the whole term. A variable rate changes the payment — this tool cannot model a rate that moves.
- Fees, origination charges and penalties are not included. A loan with a low rate and high fees can cost more than a higher-rate loan with no fees.
- The payment assumes equal monthly instalments with no missed payments. A missed payment changes the schedule and usually adds charges.
- This is general information, not financial advice. Borrowing decisions depend on the full terms, the business’s cash flow and the alternatives — consult a qualified professional before borrowing.
Worked example
Example (illustrative inputs, not a real loan). A 10,000 loan at 8% a year over 36 months:
| Item | Figure |
|---|---|
| Monthly payment | 313.36 |
| Total paid (36 × 313.36) | 11,281.09 |
| Total interest | 1,281.09 |
| Balance after 12 months | 6,921.20 |
| Balance after 24 months | 3,586.82 |
Frequently asked questions
Why does a longer term cost more?
Because interest is charged on the balance for longer. The monthly payment falls, but the balance stays higher for more months, so more interest accrues. The total interest figure is the honest cost of the extra time.
What if the interest rate is 0%?
Then the monthly payment is simply the principal divided by the term, and the total interest is zero. The calculator handles a 0% rate as that exact case.
Does this include loan fees?
No. Origination fees, arrangement charges and penalties sit outside the payment formula. Add them to the cost yourself when comparing loans — a low rate with high fees can be the dearer loan.
Is this financial advice?
No. It is a planning calculation for a fixed-rate loan. Borrowing depends on the full terms, the business’s cash flow and the alternatives — talk to a qualified professional before signing anything.