Business overdraft funding calculator

Use this page to

- work out how much you are actually paying, (your real interest rate)
- whether you could save some cost, and
- whether you could get a larger overdraft facility.


It is difficult to work out what your business overdraft facility is actually costing you.

Is it competitive?  Is it a better deal than a straight loan? Are there other alternatives?

This page is designed to help you work though these questions.

Every business has its own unique overdraft interest rate. There is no standard rate. And facility fees usually apply too.

Lenders 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, the type of loan, and the industry sector for this type of borrower.

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" lending to you is.

In addition, most banks charge a monthly fee for the overall overdraft facility. This fee has various names. We have shown it below labelled "Overdraft Mgmt fee"; it applies to the value of the whole overdraft facility whether you use it or not.

This worksheet looks at these aspects from your point-of-view.

It is not definative, only an initial assessment. You should discuss changes to your financial arrangements with a trusted adviser first. For more about your options, see our story here.

We always appreciate feedback.


What is your current business overdraft limit? 

(It's on your bank statement)

How much do you currently use? 

(It's on your bank statement)

(can't be more than Overdraft Limit.)

Who is your bank?

What is the rate you pay?     

(It's on your bank statement. eg 16.25%)

Is your overdraft secured by a property mortgage?

Your estimated annual turnover 

Your estimated month-end debtors' balance  

Your estimated month-end stock level  

From this information, we can tell you...

Your base rate is... 

(applies to what you borrow)

Your OD margin is... 

(applies to what you borrow)

What you pay as an Overdraft Mgmt fee is... 

(applies to the whole facility)

Your effective all-up interest rate is... 

Surprised ?

We suggest you talk to  because you could reduce your costs.

1.You may well be able to pay less than you do now ...

           saving up to this much per year 

2. be able to get a larger facility, up to...