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Business borrowing rates

Business base rates Intro

The best way to work out the actual cost of a business overdraft from a bank is to use our business overdraft calculator which is here. You can find the total actual rate your bank charges you on your latest bank statement.

The resources in this story may also be helpful. 

Lenders typically charge their clients a rate made up of three parts.

The first part is the base rate, one that reflects the overall market costs of the funding and treasury management.

The second part is client-specific. It takes into account the balance between the security involved, the track record of the borrower, and the specific nature of the funding requirements, among other things. This second part is usually referred to as the "margin" or "margin over base" and is essentially an assessment by the lender of how "risky" that specific loan is. You can find the total actual rate your bank charges you on your latest bank statement.

An important aspect of business borrowing is the form of security required - property or business assets.

The third part is a monthly fee that most banks charge for the overall overdraft facility. This is not on your bank statement. This fee has various names. We have shown it below and labelled it "Overdraft Mgmt fee"; it applies to the value of the whole overdraft facility whether you use it or not. The rates listed below are the annual equivalents.

We maintain this page because the changes reveal important interest-rate trends that drive business lending, rather than revealing specific lending cost levels.

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Business borrowing rates

Institution Product Type Security Base
rate %
Lenders Margin % OD Mgmt fees % Total  %
Corporate Indicator rate Variable ? 4.94 ? ? ?
  Business Bank Indicator rate Variable ? 10.40 ? ? ?
  Bill Priced Term Loan Floating Indicator rate Variable ? 7.40 ? ? ?
  Bill Priced Flexible Facility Indicator rate Variable ? 6.74 ? ? ?
  Business Equity Loan Variable ? 6.74 ? ? ?
  Business Overdraft Variable ? 12.65 ? 1.44 ?
ASB Business Lending Base Rate Variable ? 11.05 ? 1.44 ?
BNZ Business Overdraft Variable ? 10.80 ? 1.80 ?
  Corporate Prime Variable ? 10.20 ? ? ?
  Farm First Call ? 11.80 ? ? ?
  Farm First Variable ? 9.70 ? ? ?
  Agribusiness Farm First Variable ? 9.70 ? ? ?
  Rapid Repay Farming Variable ? 7.80 ? ? ?
CFF Overdraft Variable Business assets 10.50 0.00 0.00 10.50
Kiwibank Business Overdraft Rate Variable ? 9.70 ? 1.20 ?
  Business Home Equity Rate Variable ? 6.15 ? ? ?
TSB Business Fixed Rates 1 year ? 8.35 ? ? ?
  Business Fixed Rates 2 year ? 9.15 ? ? ?
  Business Fixed Rates 3 year ? 9.80 ? ? ?
  Commercial Property Fixed Rates 1 year Property 8.10 ? ? ?
  Commercial Property Fixed Rates 2 year Property 8.90 ? ? ?
  Commercial Property Fixed Rates 3 year Property 9.80 ? ? ?
Westpac Overdraft more than $5,000 Variable ? 13.95 ? 1.20 ?

 

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