Compare your funding options
Four common products, one worked example: $50,000 for a business doing $40,000 a month. Same amount, very different costs and payments.
All figures are illustrative examples using ranges typical of the Canadian and US small-business market. Actual offers depend on the lender, your bank statements, time in business and credit. CELER Funding is not a lender and nothing here is an offer.
| Product | How it's repaid | Typical term | Illustrative total cost | Illustrative payment | Speed to fund | Best for | Watch out for |
|---|---|---|---|---|---|---|---|
| Business term loan | Fixed monthly (sometimes weekly) payments of principal plus interest. | 1–5 years | 8–30% APR. On $50,000 over 2 years, roughly $54,000–$67,000 total payback. | About $2,250–$2,800 per month over 2 years. | Online lenders: a few business days. Banks: 2–6 weeks. | A planned, one-time spend such as a renovation, a second location or hiring ahead of growth. | Origination fees added to the balance; prepayment penalties; some lenders quote a monthly rate instead of an APR. |
| Business line of credit | Interest only on what you draw; repay and the limit frees up again. Some lenders require weekly principal payments on each draw. | Revolving; 6–24 month draw periods are common, renewed on review. | 8–25% a year on the drawn balance. A full $50,000 draw held for 6 months costs roughly $2,500–$6,250 in interest. | About $420–$1,050 per month in interest while $50,000 is drawn, plus principal when you pay it down. | 1–5 business days once set up; draws are usually same day. | Uneven cash flow, seasonal inventory, a safety net you may not fully use. | Annual or draw fees; rates that float; limits that can be cut on renewal. |
| Merchant cash advance | A fixed share of daily card sales (holdback), or a fixed daily/weekly bank debit, until the agreed total is paid. | 4–12 months typical | Factor rate 1.15–1.45: on $50,000 you repay roughly $57,500–$72,500 in total, regardless of how fast. | About $230–$860 per business day, or $1,100–$4,200 per week, depending on the term and holdback. | Often 1–2 business days. | Urgent, short-term needs for businesses with strong daily card volume when a bank has said no. | The most expensive option: on $40,000/month revenue the payments above are 12–45% of everything you take in. No savings from repaying early. Stacking a second advance can sink a business. |
| Equipment financing | Fixed monthly payments; the equipment secures the loan or lease. | 2–7 years, often matched to the equipment's useful life | 6–20% a year. On $50,000 over 5 years, roughly $58,000–$79,500 total payback. | About $970–$1,325 per month over 5 years. | 2–10 business days; the lender usually needs the vendor quote. | Ovens, trucks, machinery, POS hardware, anything that holds resale value. | Down payment of 0–20%; lease end-of-term buyout terms; the lender can repossess the equipment if you default. |
Illustrative, actual offers depend on the lender. Term-loan and equipment payments are amortised on the stated rate ranges; the cash advance is the factor rate multiplied by the advance; line-of-credit interest is simple interest on a full draw. Fees are not included.
Reading an offer
How to read a funding offer
Total payback
Ask for the total dollars you will hand back, not just the rate. Two offers with the same "rate" can differ by thousands once fees and the term are counted.
Factor rate vs APR
A factor rate (1.30) is a multiplier: $50,000 × 1.30 = $65,000 back. It is not an interest rate, and because it is paid over months rather than years, the equivalent APR is usually far higher than the number suggests. Ask any lender to state the cost as an APR so you can compare.
Prepayment
On a loan, paying early usually saves interest, unless there is a prepayment penalty. On a cash advance, paying early saves nothing unless a discount is written into the contract.
Daily vs monthly payments
Daily and weekly debits are quiet individually and large in total. Add them up for a month and compare that to what the business actually clears in a month.
Personal guarantee
Most small-business financing includes one: if the business cannot pay, you do personally. Read it before signing and know whether a spouse or partner is also on the hook.
Which one fits
Which one fits your situation
- A one-time project with a known price (build-out, expansion, buying out a partner): a term loan.
- Cash flow that goes up and down and you are not sure how much you will need: a line of credit.
- Buying something with resale value (truck, oven, machine, POS hardware): equipment financing, often the cheapest way to buy it.
- Money needed this week, strong card sales, and a bank has said no: a cash advance, sized so the payments still leave room to operate.
- Waiting on customers to pay invoices: invoice factoring, which is not in the table because the cost depends on your customers, not you.
- Time to wait and a strong file: an SBA or CSBFP loan, usually the lowest rate available.
Not sure? Tell us the situation and we will say which product fits, including when the answer is to wait.
See which of these your business qualifies for
Two minutes, no credit pull, no fee. We come back with the total payback on every option, in writing.