What a limit costs depends on how much you use.
Interest on a revolving facility runs on the balance rather than the limit, so the input that matters is the average amount drawn rather than the amount approved.
Last reviewed 8 September 2026
Indicative interest cost
Weekly
$150/week
Indicative only. Not a quote or offer of credit. Actual rates, fees, and repayments depend on the business profile and the lender's decision.
Sending to Prospa
Your $150,000 scenario
$60,000 drawn at 13.00% . Prospa will ask a few quick questions, then provide a firm quote and funding if eligible.
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What this tool calculates
The interest cost, not a repayment.
A revolving facility has no repayment schedule, so there is no repayment figure to produce. What the tool gives is the interest cost of carrying an average drawn balance across a year, which is the number that actually describes what the facility costs. Adding the line fee on the limit gives the annual total, and the section below works that through.
The inputs
Two numbers do the work.
The limit determines the line fee and the headroom. The average drawn balance determines the interest. Those are two different numbers doing two different jobs, and conflating them is the most common error in estimating what a facility costs.
The average drawn balance is best taken from history rather than intention. For a business that already holds a facility, twelve months of statements give it directly. For one that does not, the cash cycle multiplied by daily cost of sales is a reasonable proxy, and the guides on this site work that through.
The rate is the least reliable of the three inputs, because it depends on security, trading history and the lender. The bands used across this site are indicative and describe a market rather than an offer.
Facility limit
What is approved
Average drawn
What is used
Rate
Applied to the balance
Line fee
Applied to the limit
Worked totals
A $150,000 limit at three usage levels.
Illustrative at an indicative 13% with a 0.5% line fee. Identical facilities, very different annual costs.
| Average drawn | Interest | Line fee | Annual total |
|---|---|---|---|
| $10,000 | ~$1,300 | $750 | ~$2,050 |
| $60,000 | ~$7,800 | $750 | ~$8,550 |
| $120,000 | ~$15,600 | $750 | ~$16,350 |
| $150,000, continuously | ~$19,500 | $750 | ~$20,250 |
Illustrative on stated assumptions and rounded. Not a quote or offer of credit.
Reading the table
The last row is a term loan wearing the wrong clothes.
A facility drawn continuously to its limit is not revolving, and it is paying revolving pricing for permanent borrowing. On the figures above, that is $20,250 a year for money a term facility would have carried at a lower rate on a schedule that actually cleared it.
The first row is the opposite case and is where a revolving facility is at its best. A limit held largely undrawn costs $2,050 for capacity that was available every day of the year, and most of that is the line fee rather than interest.
The comparison worth making before taking a facility is between the expected row and what a term facility would cost for the same money. Where the business expects the third or fourth row, that comparison usually points somewhere else.
What the tool does
The arithmetic behind the figures, and what it leaves out.
In revolving mode the calculator applies the annual rate to an average drawn balance and reports the interest cost of carrying that balance. It deliberately does not produce a repayment figure, because a revolving facility has no repayment schedule and a figure implying one would misdescribe the product.
It excludes every fee. Line fees, establishment fees, review and renewal charges, excess fees and any security disbursements are all real and none of them is here, because they vary by lender in ways no formula can anticipate. On a facility held largely undrawn, the line fee is most of the annual cost, so the figure produced here is a floor rather than an estimate.
It also excludes any tax effect and anything specific to a business. It is a way of seeing how the amount drawn and the rate interact before a conversation with a lender, and it is not a quote, an application or an offer of credit. Nothing entered here is transmitted anywhere.
References
Sources
- Reserve Bank of New Zealand, interest rate statistics
Context for why indicative rate bands move over time rather than being fixed figures.
- Commerce Commission
The regulator whose guidance covers fee disclosure and representations about cost.
- Personal Property Securities Register
The register whose search and filing fees appear as disbursements on a secured facility.
- Financial Service Providers Register
Where a New Zealand lender’s registration can be confirmed before an application is made.
- Financial Markets Authority, financial advice
Backs the distinction between general information of this kind and regulated financial advice.
FAQ
The line of credit calculation, questions
Why does this calculate interest rather than a repayment?
Because a revolving facility has no repayment schedule. Producing a repayment figure would imply an amortising product, which is exactly the sort of figure that misdescribes what is being bought.
What should I enter as the drawn balance?
The average amount expected to be outstanding across the year, taken from twelve months of statements where a facility already exists, or estimated from the cash cycle where one does not.
Does the calculator include the line fee?
No. The line fee applies to the limit rather than the balance, so it cannot be derived from the same inputs. Adding it to the interest figure gives the annual total, and the worked table above shows both.
Why is the limit an input at all?
It caps the drawn balance and it determines the line fee. Both matter to the total cost, and the second is not something an interest calculation can reach.
Is the rate here realistic?
The bands used across this site are indicative and describe a market rather than an offer. Actual pricing depends on security, trading history, amount and lender, and only a lender can say what a business will be charged.
What other charges are excluded?
Establishment fees, review and renewal charges, excess and dishonour fees, and any security or registration disbursements. On a lightly used facility those and the line fee are most of the annual cost.
Are the figures here quotes?
No. Everything on this page is indicative and illustrative, calculated on stated assumptions. Actual rates, fees and limits come from a lender after assessment, and nothing here is an offer of credit.
Is anything entered here transmitted?
No. The calculator runs entirely in the browser, nothing is sent anywhere and no personal details are collected on this site at all.