Representative EAR
10.20%
Representative
Facility
Up to £250,000
Arrangement fee
1.5% of limit
£50 minimum
Account
Required
Co-operative Bank business account
Security
PG usually required
EAR excludes arrangement, renewal and other separate fees.
Business banking
Compare business overdrafts
Compare UK business overdraft facilities by borrowing rate, available limit, fees, account requirements and eligibility.
Short-term cash-flow flexibility
Designed primarily for temporary or fluctuating working-capital needs.
Pay for what you use
Interest is generally charged on the amount actually overdrawn.
Facility subject to review
Limits and availability may be reviewed by the provider.
Business banking
Accounts and overdrafts
Everyday business banking is separate from overdraft borrowing.
Business Bank Accounts
Everyday banking for companies, sole traders and partnerships.
View accountsBusiness Overdrafts
Short-term borrowing linked to an eligible business current account.
ViewingAn overdraft is borrowing. A business current account itself is not.
Compare providers
Business overdraft providers
Match facilities by representative EAR, available limit, fees, account requirements and eligibility.
Provider information last checked: 20 August 2026. Rates and eligibility can change.
How business overdrafts work
Interest is normally charged only on the amount you use, but arrangement, renewal and other fees can increase the total cost. Limits and rates are subject to provider assessment.
13 matching business overdrafts
From the providers we cover
Representative EAR
12.75%
Representative
Facility
Not publicly stated
Arrangement fee
Banded fees
See facility details
Account
Required
TSB business account
Security
Depends on facility
EAR excludes arrangement, renewal and other separate fees.
Representative EAR
13.37%
Representative
Facility
£500–£50,000
Arrangement fee
Banded fees
See facility details
Account
Required
NatWest business current account
Security
May be required
EAR excludes arrangement, renewal and other separate fees.
Representative EAR
13.37%
Representative
Facility
£500–£50,000
Arrangement fee
Banded fees
See facility details
Account
Required
RBS business current account
Security
May be required
EAR excludes arrangement, renewal and other separate fees.
Representative EAR
13%
Representative
Facility
Up to £25,000
Arrangement fee
2.5% of limit
£120 minimum
Account
Required
Virgin Money business current account / lending relationship
Security
May be required
EAR excludes arrangement, renewal and other separate fees.
Representative EAR
14.54%
Representative
Facility
Up to £100,000
Arrangement fee
Proportional fee
£25 minimum
Account
Required
HSBC Business Current Account
Security
May be required
EAR excludes arrangement, renewal and other separate fees.
Representative EAR
14.13%
Representative
Facility
From £100 · not publicly capped
Arrangement fee
1.75% of limit
£50 minimum
Account
Required
Metro Bank Business or Commercial current account
Security
May be required
EAR excludes arrangement, renewal and other separate fees.
Representative EAR
14.94%
Representative
Facility
Not publicly stated
Arrangement fee
1.75% of limit
£100 minimum
Account
Required
Santander Business Current Account - Classic
Security
Not published
EAR excludes arrangement, renewal and other separate fees.
Representative EAR
15.62%
Representative
Facility
From £500 · not publicly capped
Arrangement fee
Banded fees
See facility details
Account
Required
Lloyds Business Current Account
Security
May be required
EAR excludes arrangement, renewal and other separate fees.
Representative EAR
15.62%
Representative
Facility
From £500 · not publicly capped
Arrangement fee
Banded fees
See facility details
Account
Required
Bank of Scotland Business Current Account
Security
May be required
EAR excludes arrangement, renewal and other separate fees.
Representative EAR
16.85%
Representative
Facility
£500–£10,000
Arrangement fee
Banded fees
See facility details
Account
Required
Barclays business banking relationship/account required for facility
Security
May be required
EAR excludes arrangement, renewal and other separate fees.
Pricing basis
Bank Rate + margin
Facility
£25,001–£2,000,000
Arrangement fee
1.5% of limit
Account
Open when applying
Allica Business Rewards Account required before drawdown
Security
Security required
Fees and eligibility still apply alongside the published pricing basis.
Pricing basis
Annual interest range
Facility
Up to £10,000
Arrangement fee
Annual fee may apply
Disclosed on invitation
Account
Required
Zempler Business Go / Extra / Pro account
Security
Not published
Fees and eligibility still apply alongside the published pricing basis.
Currently unavailable
Shown for market completeness only. These providers are not accepting new business overdraft applications, so no application link is offered.
Existing facilities only; bank says it is not currently accepting business overdraft or loan applications
Currently unavailable
Business overdrafts are subject to status and may be reviewed, reduced or withdrawn. Representative EAR shows annualised interest only — compare arrangement, renewal and account fees as well. Pricing published on a different basis (Bank Rate margin, annual interest range or individual agreement) is not directly comparable with EAR.
Pricing
What does EAR mean?
Always compare EAR alongside arrangement, renewal and account fees.
EAR stands for Equivalent Annual Rate. It is designed to show the annualised cost of overdraft interest, assuming the rate remains unchanged and excluding certain separate fees.
EAR is not the same as total cost.
EAR tells you
- The annualised cost of overdraft interest, including compounding assumptions used in the published figure.
- A way to compare interest cost across facilities that publish a representative EAR on a comparable basis.
EAR does not tell you
- Separate arrangement, renewal, account, security or other fees.
- Total cost of borrowing for every usage pattern.
- A guarantee that you will be offered the published representative example.
Arranged overdraft
A borrowing limit agreed with the provider in advance.
Unarranged / excess
The account falls below £0 without an agreed facility, or exceeds the agreed limit. Charges vary — check terms.
Cost calculator
Estimate your business overdraft cost
Illustrative estimate using your own usage, EAR and fee assumptions.
Uses average amount used (£8,000.00), not the full limit, for interest. Fee amounts are spread for illustration.
Estimated costs
- Estimated interest (month)
- £49.32
- Estimated fees (month)
- £0.00
- Estimated monthly cost
- £49.32
- Estimated annual cost
- £591.78
Illustrative estimate only. Overdraft charging methods and fee structures vary between providers.
Facility review
Can a business overdraft be reduced or withdrawn?
A business overdraft is not necessarily committed long-term finance.
Depending on the agreement, the provider may review, reduce or withdraw the facility and may require repayment. Limits can change; persistent use may trigger reassessment. Avoid relying on a reviewable overdraft for permanent long-term finance.
Personal liability
Can a business overdraft require a personal guarantee?
Some providers may require directors or owners to provide a personal guarantee. This can make the guarantor personally liable for some or all of the borrowing if the business cannot repay.
Requirements vary by provider and facility. Check the scope and limits carefully.
Suitability
Who might consider a business overdraft?
Overdrafts are generally for short-term cash-flow flexibility — not long-term funding.
May be worth considering if
- You need temporary working-capital flexibility
- Cash flow fluctuates during the month
- Customer payments occasionally arrive late
- The business has seasonal peaks and troughs
- You want borrowing you can draw and repay repeatedly
- The business has predictable enough income to reduce the balance
May be less suitable if
- You need long-term investment funding
- The business remains overdrawn for long periods
- You are purchasing machinery or vehicles
- You need a large fixed amount upfront
- The business has persistent cash-flow problems
- A term loan would provide more predictable costs
Compare finance
Business overdraft or business loan?
Neither option is universally better — compare structure, cost and reviewability.
| Aspect | Overdraft | Business loan |
|---|---|---|
| Borrowing method | Draw when needed up to a limit | Usually a lump sum |
| Interest | Generally charged on the amount used | Charged under the loan agreement |
| Term | Revolving / reviewable | Fixed term in many cases |
| Repayments | Balance reduces as money comes in | Usually scheduled instalments |
| Account requirement | Linked to an eligible current account | May not require the same account structure |
| Reviewability | Often reviewable / may be withdrawn | Typically committed for the agreed term |
| Typical use | Short-term cash-flow gaps | Planned expenditure / investment |
| Predictability of costs | Depends on usage, fees and rate changes | Often clearer instalment schedule |
Business overdraft or business credit card?
Overdraft
- Linked to current account
- Useful for bank-account cash-flow shortages
- Interest on overdrawn balance
- Limit may be reviewed
Business credit card
- Separate revolving credit product
- Designed primarily for card spending
- May offer an interest-free purchase period
- Card fees and repayment terms apply
Before you apply
Before applying for a business overdraft
Check EAR, fees, account requirements and reviewability — not just the headline rate.
- 1What limit do you actually need?
- 2What interest rate or EAR applies?
- 3Is the rate fixed or variable?
- 4Are arrangement or renewal fees charged?
- 5Do you need the provider’s business current account?
- 6What is the account monthly fee?
- 7Is a personal guarantee required?
- 8Can the facility be reviewed or withdrawn?
Alternatives
Alternatives to a business overdraft
Other products may suit different funding needs.
Regulation
Regulation depends on the borrower and facility
The regulatory treatment of business overdrafts can depend on the borrower and agreement. Not all commercial business borrowing falls within the same FCA regulatory framework.
Where relevant, check the provider and activity on the FCA Register.
FAQs
Common questions about business overdrafts
Quick answers before comparing providers or applying.
How we review business overdraft information
- UK-focused editorial research
- Interest rates and fees checked against official provider sources
- Credit limits and account requirements reviewed
- Eligibility checked against provider criteria
- Personal-guarantee information checked where published
- Regulatory information checked where relevant
- Commercial relationships do not determine factual guidance
How we compare business overdrafts
- Interest rate / EAR
- Pricing basis
- Credit limit
- Arrangement fees
- Renewal fees
- Business-account fees
- Account requirement
- Eligibility
- Minimum turnover
- Trading history
- Reviewability
- Personal guarantees
- Security
- Application process
- Official provider information
- Regulatory status where relevant
Commercial relationships do not determine factual provider information or our editorial guidance.
- Last reviewed
- 20 August 2026
- Rates last checked
- 20 August 2026
- Limits / features checked
- 20 August 2026
- Eligibility checked
- 20 August 2026
- Regulatory information checked
- 20 August 2026
- Provider data last checked
- 20 August 2026
Sources and further information
Reference links only — these organisations do not endorse WIT Money.
Found an outdated overdraft rate, limit, fee or eligibility requirement?
Email contact@witfinancegroup.com. We review reported inaccuracies and update verified information promptly.
Ready to compare business overdrafts?
Review EAR, limits, fees and account requirements carefully — then explore related business banking options.