Credit Card vs Business Loan Cost Calculator

It depends almost entirely on how long the balance stays outstanding. Credit cards tend to win for expenses paid off in roughly 3 months or less — little interest accrues and there's no loan origination cost. Business loans tend to win for anything that takes longer, because the APR is usually lower than a card's and the fixed monthly payment is predictable. This calculator runs your specific expense, both APRs, and your payoff timeline to show which produces less total interest.

It computes total interest on each path and compares them. For the card, it amortizes your expense at the card APR over the number of months you say you'll take to pay it off, then sums the interest. For the loan, it uses a standard amortization schedule at the loan APR over the loan term. Whichever path has lower total interest is the winner, and the tool shows the dollar difference plus each monthly payment.

When the payoff window is short. If you can clear the balance in a month or two — or you're using a 0% intro-APR window and will pay it off before that window ends — the card can cost less than a loan carrying an origination fee and a longer amortization. The longer you carry the balance at a full card APR, the more the loan pulls ahead.

Most business credit cards run roughly 18%–30% APR, and the rate is variable (tied to the Prime rate). Rewards and cash-back cards often sit at the higher end in exchange for the rewards — so if you carry a balance, the interest usually outweighs the rewards value. Your actual rate depends on the card and your credit profile.

No — it compares interest cost only, so treat the result as a directional check. Credit-card rewards can offset part of the card's interest, and a loan origination fee adds to the loan's true cost. If either is material to your decision, adjust the winner by that amount: subtract expected rewards from the card side, and add the origination fee to the loan side.