If you want a number rather than a formula, this article is the one to read. It puts real pounds against a Credicorp Business Loan so you can estimate, before you ever apply, roughly what a given amount over a given term would cost you. For the reasoning behind the price, see what a Business Loan costs, and why; for the ceiling that sits over everything, see how the 100% total-cost-of-credit cap works. This page is the worked-figures companion to both.
The three numbers you need
Every estimate uses the same three building blocks, and nothing else is added:
- Daily interest of 0.25% per day, charged on the outstanding balance — so £1,000 of balance costs £2.50 for each day it is held.
- A single £5 establishment fee, charged once when the loan is set up — not monthly, not per payment. See the £5 establishment fee, explained.
- A 100% cap on the total cost of credit, so interest and fees together can never add up to more than the amount you borrowed — you will never repay more than double.
How to estimate it yourself
The interest on a Business Loan is simple, not compounding, so the maths is something you can do on the back of an envelope. Multiply the amount you borrow by 0.25%, then by the number of days, then add the single £5 fee:
(amount × 0.25% × number of days) + £5 = roughly what you repay. Because interest is charged only for the days you actually hold the balance, paying down sooner brings the figure below the estimate — it never pushes it above.
Three worked examples
The table below works the sum through for three different borrow amounts and terms, all within the Business Loan range of £50–£500 over 14–84 days. The "total to repay" column is the all-in figure — interest plus the one-off £5 fee.
| You borrow | Over | Interest | Establishment fee | Total to repay |
|---|---|---|---|---|
| £200 | 42 days | £21 | £5 | £26 |
| £350 | 56 days | £49 | £5 | £54 |
| £500 | 84 days | £105 | £5 | £610 |
Take the largest as the headline case: a loan of £500 over 84 days carries £105 of interest plus the one-off £5 fee, so £610 is repaid in total. Expressed as a representative APR that is about 137% — a figure that looks large only because APR annualises a cost you actually carry for a few weeks rather than a year. The number that matters in practice is the total cost of credit in pounds, and you see it before you sign.
The figures above show how the cost is built up; they are not an offer. Pricing is set on the company and the exact numbers for your loan — interest, the £5 fee and the total to repay — are shown in full on your Key Information Sheet and Business Loan Agreement before you sign. See how to read a Key Information Sheet.
Why the worst case is always knowable
Whatever the term, the 100% cap means the cost of credit on a single agreement can never exceed the amount you borrowed. Across all three examples the cost sits far below that ceiling, because the cap is a backstop rather than a target — there is no penalty interest rate, nothing compounds, and a missed payment cannot push the total past the cap. For the full mechanics of the ceiling, see how the 100% total-cost-of-credit cap works.
What can make your figure lower
Because interest runs only on the days you hold the balance, settling ahead of schedule stops the rest of it — see the early-settlement charge, explained, where a charge of up to 28 days' interest may apply and is always shown in your settlement figure first. There is no charge for applying, no charge for being declined, and no monthly account or servicing fee, so nothing is added beyond the three numbers above.
For the wider picture of how much a business can borrow and for how long, see how much your business can borrow, and for how long. Because this is lending to a company for business purposes, it sits outside FCA consumer-credit regulation under Article 60B FSMA RAO 2001 and is not covered by the Financial Ombudsman Service or the FSCS.
See also: Are there fees for paying off my facility early?, Can my rate or charges change during the term?, Do you charge any hidden fees?.