Business Funding Cost Comparison
Compare the true total cost of capital across bank loans, alternative lenders, merchant cash advances, and invoice finance for the same amount and term.
SA Business Funding
Cost Comparison
Not all funding is priced the same. Compare the true total cost of capital across the main South African funding types side by side — so you borrow smart, not just fast.
Your Funding Need
Set the amount and term to compare live.
Stronger businesses (longer trading history, collateral, clean records) get lower margins. Alternative-lender, MCA and invoice-finance rates are held at typical market midpoints.
Cheapest Option
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Total cost: R0
Cost Spread
R0
Difference between cheapest & dearest for the same cash.
Ranked: Cheapest → Most Expensive
Total cost of capitalTotal To Repay (Capital + Cost)
The lighter segment is your original capital; the coloured segment is the fees/interest you pay on top.
Why the Same R500,000 Can Cost Wildly Different Amounts
In South Africa, funding price reflects three things: risk, speed, and security. A bank taking weeks to approve a secured, well-documented loan carries far less risk than a lender who wires you cash in 24 hours on nothing but your bank statements. That risk gap is exactly what you pay for. Understanding it is the difference between funding that fuels growth and funding that quietly eats your margin.
Bank Term Loan
The cheapest capital available — typically prime + 3% to 8%. In return, banks want collateral, 2+ years of trading history and audited financials. Approval can take weeks. Best when you can wait and qualify.
Lowest cost · Slowest · Strict criteria
Alternative / Online Lender
Fintech lenders price via a monthly cost-of-capital fee on a declining balance — you only pay for the time you hold the money. Faster and lighter on paperwork than a bank, at a moderate premium.
Medium cost · Fast (24–72h) · Flexible
Merchant Cash Advance
You sell a slice of future card sales at a factor rate (e.g. 1.30 means repay R1.30 per R1). There is no interest rate and no fixed term — repayments flex with daily takings. Convenient, but almost always the most expensive option.
Highest cost · Instant · Card-turnover based
Invoice / PO Finance
Unlock cash tied up in unpaid invoices or a confirmed purchase order for a fee per 30 days. Designed for short bridges (30–90 days). Priced monthly it looks cheap; held for many months it becomes costly — match it to your payment cycle.
Short-term tool · Fast · Fee per 30 days
Why is a Merchant Cash Advance so much dearer?
Speed & access
Cash in hours with almost no paperwork. That convenience is priced in — the lender takes on far more uncertainty.
No collateral
Unsecured and based only on card turnover. If sales dip, the lender absorbs the risk — so they charge a premium for it.
A factor, not a rate
A 1.30 factor over a few months is a huge annualised cost. Fast repayment makes the effective rate even higher.
Rule of thumb: use an MCA only for short, high-return bursts (urgent stock for a confirmed order, a supplier discount that beats the fee). For anything you'll repay over many months, cheaper structured funding almost always wins.