How representative APR is set — and why your

2 min read

51% ruleMajority must get it

Risk-pricedYour rate differs

A benchmarkNot a quote

Amount borrowed (£)

Arrangement & other fees (£)

Annual interest rate (%)

Term (months)

Estimates an annualised cost including fees so you can compare offers like-for-like. Illustrative, not a statutory APR.

What a representative APR actually promises

On regulated consumer credit, a lender advertising a representative APR must offer that rate (or better) to at least 51% of the people it accepts. It bundles interest and compulsory fees into one annualised number. It is designed to stop teaser advertising — but it is still a marketing benchmark, not the rate any individual is guaranteed.

Why business borrowers are quoted differently

Lending to a limited company is an exempt agreement, outside the consumer-credit APR rules. Business lenders price each deal to the company’s risk through risk-based pricing — trading history, credit score, security and affordability all move the margin. So your personal APR is what matters, not the advertised one.

How to use the headline sensibly

Treat the representative APR as a shortlist filter, then get a real quote and compare on that. Always ask for the total amount payable including every fee, since a low advertised rate with a chunky arrangement fee can cost more than a higher rate with none.

Work it out for yourself

Enter an amount, rate and term below to see the monthly payment and total cost, then line quotes up on the same basis rather than on their headlines.

Where Credicorp fits

Credicorp lends to your company, not to you personally, and takes no personal guarantee. See indicative terms on business loans, or apply online in minutes.

Credicorp quotes transparently so you see the total repayable up front. Read personal APR and how to lower the APR you are offered next.

Frequently asked questions

Will I get the representative APR?

Not necessarily. On business lending your rate is priced to your company’s risk, so it can be above or below any advertised figure. Get a personal quote and compare on that.

Does representative APR include fees?

Yes — compulsory fees are folded into the APR calculation, which is exactly why it is a fairer basis for comparison than the interest rate alone.

Why do business lenders not always show an APR?

Business lending is exempt from the consumer-credit APR rules. Good lenders still provide one, or a total repayable, so you can compare — always ask.