What is an installment loan?

An installment loan, sometimes referred to as a Term Loan, is a type of loan with a fixed lump sum that you pay back over a set period called “installments.” Your installment payments are determined by the length of the loan, the amount of the loan and the interest rate charge

What is the difference between a loan and line of credit?

The main difference is that a loan is ideal for one-time expenses and a line of credit is a flexible way to borrow when you’re not exactly sure how much you’ll need. A small business installment loan is a declining balance amortizing term loan, and once repaid, funds cannot be re-borrowed and it must be paid off within the approved amortization period. A small business credit line is a revolving product, so funds can be paid and re-borrowed, working within a credit limit.

What is BMO’s Prime Rate?

The BMO Prime Rate – also known as the prime lending rate – is the annual rate we use to set variable interest rates for our loans, lines of credit and mortgages. The actual rate you’ll get on your loan or line of credit is based on many factors in addition to the Prime Rate, including how much you’re borrowing, your credit history and if you’re using collateral.

How can I calculate what my loan payments will be?

It’s easy, try our Loan Calculator to get an idea of how much your payments will be.

Small Business Installment Loan

What you can use your business loan for

Upgrade equipment

Buy or install equipment, or other capital assets, to help grow your business.

Invest in property

Open new locations or renovate current properties.

Refinance debt

Streamline cash flow and management of payments.

Benefits and features

Competitive interest rates
Flexibility to choose a variable or fixed rate
Choose the term that works for you (between 1 and 5 years based on useful life of what is being purchased)

Simple, no-fee application
Automate payments with pre-authorized payments from your business account
Save on interest by making lump sum payments anytime

Commercial Loan Insurance Plan: Protect your business, family and employees with creditor insurance

Fixed rates vs variable rates: pick your path forward

Find the right financing option for your business.

Fixed rate business loan

Enjoy the stability

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Stable & predictable

Know how much you’re going to be paying every month.

Long term peace of mind

Plan the future of your business with peace of mind knowing that your interest rate and payments won’t change.

Variable rate business loan

Embrace flexibility

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Lower interest rates

Benefit from lower interest rates if BMO Prime Rate goes down.

Flexibility

Convert to a fixed rate if BMO Prime Rate goes up.

loan calculator

Here’s how to get a Business Loan

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Book an appointment at your nearest BMO branch to talk to a banking Relationship Manager.
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Come in, bring the documents listed below and let’s talk about your business needs.
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We’ll review your needs to make sure you have the lending plan that’s right for you.
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Complete the application process to receive your funds.

Let’s do this! What do I need to know before applying?

Government-issued photo ID
Recent T4/T4A slips or RL1 if you’re a resident of Quebec, or T1 income tax return or Revenue Quebec TP1 with corresponding notice of assessment
Trade Name Registration document if your business operates under a Registered Trade Name
Company financial statements, if available

If you’re a General Partnership, Limited Partnership and Limited Liability Partnership, also bring one of the following:

Certificate of General Partnership
Declaration of a Partnership
Application for Registration of a Partnership
If required in your province or territory, a Partnership Agreement Application for Registration of a Partnership

If you’re a Corporation, also bring one of the following:

Articles of Incorporation
Letters Patent / Company Charter
Articles of Amendment
Articles of Amalgamation
Corporate Profile Report

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Small Business Installment Loan FAQs

A loan is ideal when you need all of your money up-front to make a one-time large purchase. They have scheduled payments that are a mixture of principal and interest so the loan is paid off in a fixed amount of time. Once repaid, funds cannot be re-borrowed.
A credit line lets you borrow what you need when you need it so it’s great for managing your cash flow and financing projects over time. They are ideal when you don’t need all the available money right away or don’t know how much you will need as you only pay interest on the amount you have borrowed. As you pay down your credit line the funds become available for use again.
The BMO Prime Rate – also known as the prime lending rate – is the annual rate we use to set variable interest rates for our loans, lines of credit and mortgages. The actual rate you’ll get on your loan or line of credit is based on many factors in addition to the Prime Rate, including how much you’re borrowing, your credit history and if you’re using collateral. You can see our current Prime Rate here.

Ready to get started?

Find a branch

Locate a BMO branch near you.

Find a branch

Visit us

Book an appointment at your nearest branch to discuss business needs.

Book an appointment

Call us

Give us a call, 24 hours a day, 7 days a week.

1-877-262-5907

- ¹Subject to BMO’s credit-granting criteria.
- ²These calculations are approximate and for information purposes only. Actual payment amounts may differ and will be determined at the time of your application. Please do not rely solely on this information or result when making financial decisions; please visit your branch. Amortization can only be entered in full years (not months or partial years). Loan amount is rounded to the nearest $1,000.
- dagger detail BMO will endeavor to make the payment on your behalf, within the framework of the applicable terms and conditions. However, please note that unforeseen circumstances may arise which may interfere with the timing of the payment.

Small Business Installment Loan