What is a Commercial Loan? How to Calculate and Application Requirements

Financing Your Business: Commercial Loans

A commercial loan is a specialized financial product provided by banks to meet the financial needs of small businesses (SMEs), tradespeople, and other commercial enterprises. These loans can be used for various purposes such as working capital, business premises, vehicles, or cash advances.

In this guide:

• What a commercial loan is

• The types of commercial loans

• Application requirements

• How to calculate the loan

• Applicable taxes and funds

💡 Quick Tip: Want to calculate now? Use our Commercial Loan Calculator at the top of the page to instantly see monthly installments and total costs!

What is a Commercial Loan?

A commercial loan is any type of borrowing that businesses such as SMEs or tradespeople take from financial institutions to support their operations.

Examples of Commercial Loans:

• Commercial Needs Loan

• Business Premises Loan

• Commercial Vehicle Loan

• Commercial Cash Advance

Types of Commercial Loans

1. Commercial Needs Loan
Used for working capital, inventory replenishment, technology, or equipment purchases.

2. Business Premises Loan
Used to purchase a new business location, take over an existing premises, or acquire investment properties.

3. Commercial Vehicle Loan
Used to acquire vehicles necessary for business operations.

Commercial Loan Application Requirements

• Business Owner: Can be an individual or a legal entity.

• Business Activity Certificate: Proof that the business is officially active.

• Financial Status: Ledger books, income statements, or similar documents.

• Credit Score: The bank reviews past repayment history.

• Collateral: Some banks may require collateral. Alternatively, the Credit Guarantee Fund (KGF) can be used.

💡 Note: The KGF provides a guarantee for SMEs with insufficient collateral, enabling them to access loans.

How to Calculate a Commercial Loan

Commercial loans are usually calculated using the equal installment (annuity) method:

$$\text{Monthly Installment} = K \cdot \frac{r (1+r)^n}{(1+r)^n – 1}$$

Monthly Installment=K⋅(1+r)n−1r(1+r)n​

Where:

• K = Loan amount

• r = Monthly interest rate

• n = Term in months

Example Calculation:

• Loan Amount: 150,000 TRY

• Annual Interest Rate: 2.50% → Monthly: 0.2083%

• Term: 36 months

$$\text{Monthly Installment} \approx 4,520.50 TRY$$

$$\text{Monthly Installment}\approx 4,520.50TRY$$

Taxes and Funds on Commercial Loans

• BSMV (Banking and Insurance Transactions Tax): 5% on interest

• KKDF (Resource Utilization Support Fund): 0% on interest

💡 Note: For commercial loans, the KKDF rate is 0%.

Maximum Repayment Terms

• Business premises loans can be extended up to 120 months.

• Other commercial loans typically have a maximum term of 60 months.

Frequently Asked Questions (FAQ)

🔹 What is the KKDF rate for commercial loans?
For commercial purposes, the KKDF rate is 0%.

🔹 What is needed to get an SME loan?
You need a business activity certificate, financial statements, and a review of your banking relationships.

🔹 Can tradespeople get a commercial loan?
Yes, tradespeople are eligible for commercial loans.

🔹 What is KGF and how does it work?
The Credit Guarantee Fund (KGF) acts as a guarantor if your collateral is insufficient. To apply, submit your request through a bank partnered with KGF.

Conclusion: Grow Your Business with a Commercial Loan

A commercial loan is a powerful tool to support your business growth and sustainability. However, you must:

• Calculate interest and taxes correctly

• Balance monthly installments with your income

• Prepare all required documents

🏢 Disclaimer: This calculator and guide are for informational purposes only. Always consult your bank for exact figures.