Guide · Pricing
Business Loan Interest Rates Explained
Rates vary wildly by product, lender, and borrower profile. Here's a clear table of what each product type typically costs in 2026, plus what really drives your number.
Typical rate ranges by product
| Product | Typical range | Term |
|---|---|---|
| Bank term loan | 6–13% APR | 1–10 years |
| SBA 7(a) | ~8–13% APR | 5–25 years |
| Online term loan | 9–45% APR | 6 mo – 5 yr |
| Business line of credit | 10–25% APR | Revolving |
| Equipment financing | 7–20% APR | 2–7 years |
| Revenue-based / working capital | 20–60% effective APR | 3–24 months |
| MCA | 1.15–1.50 factor rate | 3–18 months |
Ranges are illustrative — actual offers vary by lender and borrower profile.
APR vs factor rate
A 1.30 factor rate on $50,000 over 9 months means you pay back $65,000 total — $15,000 in cost. That's roughly a 65% effective APR. Always convert factor rates to APR for an apples-to-apples comparison.
Get competing offers
The fastest way to a better rate is multiple lenders bidding on the same file. One BizKred application does that.
Frequently asked questions
What's a typical business loan interest rate?
Bank term loans: 6–13%. SBA: ~8–13%. Online term loans: 9–45% APR. MCAs are quoted as factor rates (1.15–1.50) which translate to much higher effective APRs.
What's the difference between APR and factor rate?
APR is an annualized percentage. A factor rate is a multiplier on the principal (e.g., 1.30 = $1.30 back for every $1 borrowed). Factor rates ignore time, so short-term MCAs can have effective APRs of 50–150%.
What drives my rate?
Credit score, time in business, revenue stability, industry, term length, and whether the loan is secured.
Can I negotiate the rate?
Yes — multiple competing offers are the strongest leverage. That's the whole point of applying through a broker.
Is a lower rate always better?
Not always. A longer-term low-rate loan may cost more in total interest than a short, higher-rate facility. Compare total cost of capital, not just the rate.