By John Pierre Saliba · April 2026 · OverdraftMe
A $100,000 business overdraft has three cost components: interest on what you draw, a line fee on the total limit, and a one-off establishment fee. Here are the real numbers.
| Cost component | Typical range | Annual cost on $100,000 |
|---|---|---|
| Interest rate (on drawn balance) | 14.55% - 25% p.a. | Depends on usage (see below) |
| Line fee (on total limit) | 1% - 2% p.a. | ${int(int(amt_slug)*0.01):,} - ${int(int(amt_slug)*0.02):,} |
| Establishment fee (one-off) | $0-$995 | $495-$795 typical |
The real cost depends on how much you actually draw. Most businesses don't use their full limit every day.
| Usage scenario | Avg drawn balance | Monthly interest (at 18%) | Monthly line fee (1.5%) | Total monthly |
|---|---|---|---|---|
| Light use (25%) | ${int(int(amt_slug)*0.25):,} | ${int(int(amt_slug)*0.25*0.18/12):,} | ${int(int(amt_slug)*0.015/12):,} | ${int(int(amt_slug)*0.25*0.18/12)+int(int(amt_slug)*0.015/12):,} |
| Moderate use (50%) | ${int(int(amt_slug)*0.5):,} | ${int(int(amt_slug)*0.5*0.18/12):,} | ${int(int(amt_slug)*0.015/12):,} | ${int(int(amt_slug)*0.5*0.18/12)+int(int(amt_slug)*0.015/12):,} |
| Heavy use (75%) | ${int(int(amt_slug)*0.75):,} | ${int(int(amt_slug)*0.75*0.18/12):,} | ${int(int(amt_slug)*0.015/12):,} | ${int(int(amt_slug)*0.75*0.18/12)+int(int(amt_slug)*0.015/12):,} |
| Full draw (100%) | $100,000 | ${int(int(amt_slug)*0.18/12):,} | ${int(int(amt_slug)*0.015/12):,} | ${int(int(amt_slug)*0.18/12)+int(int(amt_slug)*0.015/12):,} |
Yes. All interest and fees on a business overdraft used for business purposes are generally tax deductible. At the 25% base rate entity tax rate, a monthly cost of $1,250 effectively becomes ${int(int(monthly_high.replace(",",""))*0.75):,} after the deduction.
If your business needs a $100,000 cash flow buffer, the real question is: what does NOT having it cost you? Late supplier payments, missed opportunities, ATO penalties (non-deductible), or worse - not making payroll. For most businesses, the cost of the overdraft is a fraction of the cost of running out of cash.
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Check your eligibility →Written and reviewed by John Pierre Saliba, Director and Senior Finance Broker, MFAA Accredited. Last reviewed 18 September 2026.
| Rate | Weekly cost | Monthly cost | Annual cost |
|---|---|---|---|
| 14.55% p.a. | $213/week | $926/month | $11,122/year |
| 18% p.a. | $253/week | $1,099/month | $13,192/year |
| 25% p.a. | $334/week | $1,449/month | $17,392/year |
Assumptions: 60% of the facility drawn and held constant (interest-only view), interest charged on the drawn balance, line fee of 0.046% per week on the full limit. Repaying the balance down adds principal on top of these figures - model a declining-balance schedule with the "Repay over term" view in the business overdraft calculator. Indicative only, subject to lender assessment - rates through the OverdraftMe panel run 14.55% to 25% p.a. See also the unsecured business overdraft guide.