Small Business Remedies

Small Business Borrowing

We are always looking to improve the information available to small business customers and specifically in this instance those considering borrowing to develop their business. The information contained in this section is primarily aimed at those customers interested in borrowing up to £25,000 on an unsecured basis either through a loan or an overdraft.

The following sections set out additional information to help inform your potential borrowing requirements.

  1. Section 1 sets out the Annual Percentage Rates (APR) for amounts up to £25k and terms from 1 to 5 years
  2. Section 2 explains what factors are used in making the APR calculation.
  3. Section 3 displays the effective annual rate of borrowing using an unsecured overdraft.
  4. Section 4 includes the table showing cost of borrowing by unsecured loan various amounts over terms of 1 to 5 years.
  5. Section 5 provides a copy of the terms and conditions applicable for borrowing by means of a variable rate loan. You must be 18 or over. Lending criteria, terms and conditions apply.

Section 1:

This section displays the APR associated with borrowing varying amounts over different periods of time. These examples are subject to change if the underlying reference rate Danske Bank Base Rate (DBBR) changes (this is currently 0.25%).

APR based on a Variable rate loan at a rate of 7.25% plus £125 fee
Amount Term
1 Year
Term
2 Years
Term
3 Years
Term
4 Years
Term
5 Years
£5,000 12.40% 10.10% 9.30% 8.80% 8.60%
£10,000 9.90% 8.80% 8.30% 8.10% 8.00%
£15,000 9.10% 8.30% 8.00% 7.90% 7.80%
£20,000 8.70% 8.10% 7.90% 7.80% 7.70%
£25,000 8.40% 8.00% 7.80% 7.70% 7.70%

Section 2:

Annual Percentage Rate: APR is calculated on the basis that all offers for term lending will be priced at the standard published margin of 7%.

The APR includes the £125 arrangement fee. APR is affected by the amount, term, rate and arrangement fee of any loan and is designed to reflect the total cost of borrowing. Further information on APR can be found in our glossary.

Section 3:

Effective Annual Rate (EAR) for Business Current Account (BCA) overdrafts:
EAR takes into consideration the compounding effect of debit interest on the overdraft. It differs from an APR as it does not include any additional costs such as an arrangement fees.


EAR for BCAs

7.25% (DBBR + 7%) = EAR of 7.45%
Costs associated with BCA overdraft approval, usage and renewal:
Overdraft Arrangement Fee £125
If you were overdrawn for 5 days by £3,000 the interest cost would be £2.98
Annual Renewal Fee 0.60% (minimum fee £50): fee for a £3,000 overdraft would be £50



Transaction fees may also apply, please see our Fees & Services charges applied brochure.

Section 4:

The table below sets out the indicative cost of borrowing varying amounts up to £25,000 over terms of 1 to 5 years. Whether we provide credit depends on your circumstances, and you must be 18 or over. Lending terms and conditions apply.

Loan repayments are indicative only and are based on a variable rate on 7.25% (which is Danske Bank Base Rate plus a margin of 7%). We also assume no change to base rate during the loan period. The calculation also includes an arrangement fee of £125 being applied at the outset of the loan.

Amount Term 1 Year
Monthly Cost
Total Capital & Interest Total Cost of Credit
£5,000 £433.60 £5,203.20 £5,328.20
£10,000 £867.19 £10,406.28 £10,531.28
£15,000 £1,300.78 £15,609.36 £15,734.36
£20,000 £1,734.38 £20,812.56 £20,937.56
£25,0000 £2,167.97 £26,015.64 £26,140.64


Amount Term 2 Years
Monthly Cost
Total Capital & Interest Total Cost of Credit
£5,000 £224.63 £5,391.12 £5,516.12
£10,000 £449.25 £10,782.00 £10,907.00
£15,000 £673.87 £16,172.88 £16,297.88
£20,000 £898.50 £21,564.00 £21,689.00
£25,0000 £1,123.12 £26,954.88 £27,079.88


Amount Term 3 Years
Monthly Cost
Total Capital & Interest Total Cost of Credit
£5,000 £155.10 £5,583.60 £5,708.60
£10,000 £310.19 £11,166.84 £11,291.84
£15,000 £465.29 £16,750.44 £16,875.44
£20,000 £620.38 £22,333.68 £22,458.68
£25,0000 £775.48 £27,917.28 £28,042.28


Amount Term 4 Years
Monthly Cost
Total Capital & Interest Total Cost of Credit
£5,000 £120.43 £5,780.64 £5,905.64
£10,000 £240.85 £11,560.80 £11,685.80
£15,000 £361.27 £17,340.96 £17,465.96
£20,000 £481.70 £23,121.60 £23,246.60
£25,0000 £602.12 £28,901.76 £29,026.76


Amount Term 5 Years
Monthly Cost
Total Capital & Interest Total Cost of Credit
£5,000 £99.70 £5,982.00 £6,107.00
£10,000 £199.39 £11,963.40 £12,088.40
£15,000 £299.08 £17,944.80 £18,069.80
£20,000 £398.77 £23,926.20 £24,051.20
£25,0000 £498.46 £29,907.60 £30,032.60

Section 5:

Example of typical terms and conditions for small businessesExample of typical terms and conditions for small businesses​​​​​
Contact
0345 850 9515

Contact us

Customer information Useful numbers Book Appointment Become a customer

Chat with us

Customer Support

Find out more

Find a business Centre