Get Business Loan Refinance today

Business Loan Refinance Finland

Free, 100% digital Business Loan Refinance comparison

Save money with lower interest rates

Instant answers from up to 23 Finnish lenders

Loan Amount:

EUR

Loan term (years):

- +

Monthly Payment: 0

Loan Purpose: Consolidation Car Motorcycle/Boat Home renovation Vacation/Travel Special events Housing deposit Dental Debt coverage Electronics Other

Compare now

Loan example: *The loan term can be 1-20 years, the loan amount is €1,000–€70,000 and the interest rate is 4–20%. Example: When the loan amount is €15,000, the interest rate is 6%, the repayment period is 8 years, the opening fee is €0 and the account management fee is €5/month, the monthly installment is €202, the amount to be repaid is €19,404 and the annual percentage rate is 6.89%. Please note that the loan can also be repaid faster.

Business loan refinance in Finland allows companies to restructure existing debt obligations to improve financial stability or reduce costs. This financial strategy involves taking out a new loan to pay off one or more existing business loans. The primary goal is often to secure a lower interest rate, extend the repayment term, or release collateral that was tied to the previous funding arrangement. Finnish companies, ranging from sole traders (toiminimi) to limited liability companies (osakeyhtiö), utilize refinancing to manage cash flow more effectively.

The process requires a thorough assessment of the company’s current financial health. Lenders in Finland will scrutinize the business’s ability to service the new debt. This evaluation includes reviewing financial statements, tax payment history, and credit reports. A successful business loan refinance can consolidate multiple high-interest debts into a single monthly payment. This simplifies administrative tasks and can significantly improve monthly liquidity.

Rates and Fees

The cost of refinancing a business loan varies significantly depending on the lender type and the financial strength of the company. Traditional Finnish banks generally offer lower interest rates but require collateral. Online lenders and financial institutions specializing in unsecured corporate credit typically charge higher rates to offset the increased risk.

The following table outlines typical costs associated with business loan refinancing in Finland.

Fee Type	Traditional Banks	Online Lenders / Fintech
Annual Interest Rate	3% – 8% + Euribor	10% – 35% (Fixed)
Establishment / Arrangement Fee	€200 – €2,000	€0 – €500 (or % of loan)
Monthly Account Fee	€5 – €20	€10 – €50
Early Repayment Fee	Possible (if fixed rate)	Usually €0
Collateral Requirements	Real estate, business mortgage, Finnvera guarantee	Personal guarantee (Omavelkainen takaus)
Approval Time	1 – 4 weeks	1 – 3 days

Interest rates for business loans are often tied to reference rates such as the 3-month or 12-month Euribor. When the Euribor is positive, it is added to the bank’s margin. If the reference rate is negative, the total interest is usually equal to the margin, as loan agreements typically stipulate that the reference rate cannot be below zero. Online lenders more frequently offer fixed monthly costs or fixed interest rates that do not fluctuate with market conditions.

Establishment fees cover the administrative work of processing the new loan application. For larger refinancing arrangements involving millions of euros, these fees can be negotiated. For smaller loans provided by digital lenders, the setup fee is often a percentage of the loan capital. Borrowers must calculate the effective annual interest rate (todellinen vuosikorko) to understand the true cost of refinancing, including all ancillary fees.

The Mechanics of Refinancing Business Debt

Refinancing technically involves the origination of a new credit facility. The proceeds from this new facility are used to settle the outstanding principal and accrued interest of the original loans. In Finland, this transfer of funds is often handled directly between banks to ensure the old debt is extinguished. The borrower does not always receive the cash; instead, the new lender pays the old lender.

Companies must check the terms of their current loans before proceeding. Some fixed-rate loans in Finland carry exit fees or breakage costs. These fees compensate the bank for the interest income lost due to early repayment. If the breakage cost is high, refinancing may not yield net savings even if the new interest rate is lower.

Variable-rate loans are generally easier to refinance without significant penalties. Finnish law and banking practice allow for the prepayment of variable-rate loans with minimal friction. However, notice periods may apply. The new loan agreement will establish a fresh repayment schedule, which can be tailored to the company’s current revenue cycle.

Credit Assessment and Data Registries

Finnish lenders rely heavily on automated and manual credit checks. The primary sources of credit data in Finland are Suomen Asiakastieto and Bisnode Finland. These agencies maintain comprehensive databases on the payment behavior of both individuals and businesses. When a company applies to refinance, the lender retrieves a credit report that details the company’s risk classification.

The risk classification, often referred to as Rating Alfa or a similar scoring model, ranges from AAA (highest creditworthiness) to C (high risk). A company with a strong rating can negotiate competitive margins. A company with a declining rating may find it difficult to find a lender willing to take on the risk, or they will be offered significantly higher interest rates.

Lenders also review the company’s official financial statements (tilinpäätös). This includes the income statement and balance sheet. They look for profitability, equity ratio, and liquidity. For sole traders, the personal creditworthiness of the entrepreneur is inextricably linked to the business. In these cases, the lender assesses the individual’s personal finances alongside the business figures.

Payment Defaults and Maksuhäiriömerkintä

A payment default entry, known in Finland as “maksuhäiriömerkintä,” is a critical factor in loan refinancing. If a company or its responsible persons have a payment default entry, obtaining financing from traditional banks is virtually impossible. Most online lenders also reject applications automatically if a default entry exists.

These entries are recorded in the credit information registers maintained by Suomen Asiakastieto and Bisnode. They result from prolonged non-payment of debts that have proceeded through the collection process. A default entry signals to lenders that the borrower is high-risk.

Recent legislative changes in Finland have accelerated the removal of payment default entries. Once a debt causing a default entry is paid in full, the entry is removed from the register within one month. This allows companies that have rectified their financial situation to access the credit market sooner. However, until the entry is removed, refinancing options are extremely limited or non-existent.

The Role of the Finnish Enforcement Authority

The Finnish Enforcement Authority, or Ulosottolaitos, handles the collection of debts that have not been paid voluntarily. If a business has debts in enforcement (ulosotto), it indicates severe financial distress. Lenders check the enforcement register as part of their due diligence.

Active enforcement cases are a major red flag. Refinancing a loan to pay off enforcement debts is complex. Traditional banks rarely engage in this type of financing. Specialized lenders may consider it only if there is significant real estate collateral available to secure the loan. The goal in such cases is to stop the enforcement process and stabilize the company, but the cost of such financing is high due to the risk.

Collateral and Guarantees in Finland

Collateral is a defining element of business financing in Finland. Traditional banks almost always require collateral to secure a loan. This reduces the lender’s risk and allows for lower interest rates. Common forms of collateral include real estate, business mortgages (yrityskiinnitys), and investment portfolios.

A business mortgage is a specific Finnish legal instrument. It allows a company to pledge its movable assets—such as machinery, inventory, and equipment—as collateral without handing over possession. The National Land Survey of Finland (Maanmittauslaitos) manages the registration of these mortgages.

For smaller companies or those without significant physical assets, personal guarantees are common. A personal guarantee (omavelkainen takaus) means the entrepreneur is personally liable for the debt if the company fails to pay. This is standard practice for loans from online lenders and for smaller bank loans.

Finnvera’s Role in Refinancing

Finnvera is a specialized financing company owned by the State of Finland. It provides guarantees to supplement the collateral required by banks. Finnvera does not typically grant loans for refinancing existing debt owed to other financial institutions. Their mandate is to promote new business activity, growth, and internationalization.

However, Finnvera guarantees can be part of a broader restructuring package. If a company is negotiating a new financing arrangement to expand, Finnvera might guarantee the new portion of the debt. This can indirectly assist in stabilizing the company’s overall collateral position.

Finnvera’s “Start Guarantee” and “SME Guarantee” are widely used products. They provide the bank with a guarantee covering up to 80% of the loan amount. This encourages banks to lend to companies that have viable business models but lack sufficient hard collateral.

Refinancing for Sole Traders vs. Limited Companies

The legal structure of the business impacts the refinancing process. Sole traders (toiminimi) are personally responsible for all business debts. There is no legal separation between the business assets and the individual’s assets. Consequently, refinancing a sole trader loan often involves a personal credit check and affects the individual’s personal debt-to-income ratio.

Limited liability companies (Osakeyhtiö or Oy) are separate legal entities. The debt belongs to the company. However, for small and medium-sized enterprises (SMEs), lenders frequently require a personal guarantee from the main shareholders. This bridges the gap between the corporate entity and the owners.

When a limited company refinances, the decision must usually be documented in the board meeting minutes. The person signing the loan agreement must have the authority to sign for the company, which is verified through the Finnish Trade Register (Kaupparekisteri).

Online Lenders vs. Traditional Banks

The market for business loans in Finland has diversified. Traditional banks like OP, Nordea, and Danske Bank dominate the market for large, secured loans. They offer the lowest rates but have slow processing times and strict criteria. Meetings are often required, and the documentation burden is heavy.

Online lenders and fintech companies offer speed and accessibility. They utilize algorithms to analyze bank account data and credit scores instantly. A company can receive a refinancing offer within hours. These lenders are suitable for smaller amounts or when speed is critical.

The trade-off is cost. Online lenders take on higher risk by lending without real collateral, relying instead on cash flow analysis and personal guarantees. Consequently, their interest rates are higher. Companies must weigh the urgency of their need against the long-term cost of the capital.

Documentation Required for Refinancing

Preparing the correct documentation accelerates the refinancing process. Finnish lenders require a standard set of documents to evaluate a business.

Key documents include:

• Financial Statements: The most recent official financial statements (tilinpäätös) including the profit and loss account and balance sheet.
• Current Period Accounts: An interim ledger or profit report for the current fiscal year to demonstrate recent performance.
• Tax Certificate: A certificate proving there are no outstanding tax liabilities (verovelkatodistus).
• Bank Statements: Account statements for the last 3 to 6 months to verify cash flow.
• Business Plan: For larger amounts, a brief description of how the refinanced loan will support the business.

Digital lenders often use “open banking” technology. This allows the applicant to securely connect their business bank account during the application. The lender’s system automatically scrapes the transaction history to assess revenue and expenses, eliminating the need for manual PDF uploads.

Strong Electronic Identification

All digital financial transactions in Finland require strong electronic identification (vahva tunnistautuminen). This is mandated by law to prevent fraud and money laundering. Business owners must use their personal Finnish Bank IDs (verkkopankkitunnukset) or a Mobile Certificate (Mobiilivarmenne) to log in to loan portals and sign agreements.

Even when applying on behalf of a company, the individual identifies themselves personally. The system then checks the Trade Register to verify that the individual has the right to sign for the company (nimenkirjoitusoikeus). If the company requires two signatures, both directors must sign the digital document electronically.

Refinancing to Release Collateral

A strategic reason to refinance is to release collateral. As a business pays down a loan, the value of the collateral pledged (e.g., a commercial property) may exceed the remaining loan balance significantly. However, the bank typically holds the collateral until the entire debt is cleared.

By refinancing with a new loan, the company can pay off the old debt and release the original collateral. The new loan might be unsecured or secured by different assets. This frees up the property to be used as security for other growth initiatives or investment loans.

Debt Consolidation for Businesses

Small businesses often accumulate multiple small loans, credit card balances, and installment plans. Servicing several creditors simultaneously is inefficient. Each creditor charges a separate account management fee.

Refinancing functions as a debt consolidation loan in this context. The business takes one large loan to pay off all smaller debts. The result is a single monthly invoice and a single account fee. This provides clarity on cash flow and reduces the risk of accidentally missing a payment date.

Regulatory Supervision and Consumer Protection

Business lending is less regulated than consumer lending in Finland, but oversight exists. The Finnish Financial Supervisory Authority (Finanssivalvonta or FIN-FSA) supervises banks and payment institutions. They ensure that these institutions maintain adequate capital buffers and risk management systems.

The Finnish Consumer Protection Act (Kuluttajansuojalaki) generally does not apply to business loans. This means that interest rate caps and strict marketing restrictions designed for consumers are not applicable to corporate contracts. Business owners must be diligent in reading terms and conditions, as the law assumes a business entity is a knowledgeable counterpart.

However, the Finnish Competition and Consumer Authority (KKV) monitors marketing practices to ensure they are not misleading. If a lender makes false claims about interest rates or fees, they can be sanctioned. For sole traders, the line is sometimes blurred. If a loan is taken primarily for private use but guaranteed by the business, or vice versa, interpretation of consumer protection laws can vary, but strictly business-purpose loans remain outside consumer protection scopes.

Floating vs. Fixed Interest Rates

Choosing between floating and fixed rates is a key decision during refinancing. Most corporate loans in Finland are floating-rate loans, tied to Euribor. This exposes the business to interest rate risk. If Euribor rises, the monthly debt service cost increases.

Fixed-rate loans provide certainty. The business knows exactly how much it will pay every month for the duration of the loan. This is valuable for budgeting. However, fixed rates typically include a premium over the current floating rate. Lenders charge this premium to hedge their own risk.

Refinancing is the primary mechanism for switching from a floating rate to a fixed rate, or vice versa. If a company anticipates rising market rates, it may refinance into a fixed-rate product to lock in costs. Conversely, if rates are falling, refinancing into a variable product can generate savings.

Covenants and Loan Conditions

Bank loans often come with covenants. These are conditions the borrower must meet throughout the loan term. Common covenants include maintaining a certain equity ratio or a maximum debt-to-EBITDA ratio. If the company breaches a covenant, the bank has the right to call in the loan or renegotiate terms.

Refinancing can be used to escape restrictive covenants. If a company’s financial situation has improved, it may find a new lender willing to offer funds with fewer strings attached. This increases operational flexibility. Conversely, a company in distress might refinance to loosen covenants that it is in danger of breaching, although this usually comes at a higher cost.

The Impact of Loan Term on Monthly Payments

Extending the loan term is a common motivation for refinancing. A longer repayment period reduces the monthly principal payment. This immediately improves the company’s liquidity position.

For example, a €50,000 loan with a 2-year remaining term has high monthly payments. Refinancing that €50,000 over a new 5-year term drastically lowers the monthly cash outflow. The trade-off is that the total interest paid over the life of the loan increases. Companies must calculate whether the immediate cash flow relief justifies the higher total interest cost.

Refinancing Invoice Finance and Factoring

Beyond term loans, companies in Finland use invoice financing (laskurahoitus) and factoring. These facilities provide advances on accounts receivable. Refinancing can involve switching from a factoring arrangement to a term loan, or switching factoring providers.

Some companies find that factoring fees are higher than the interest on a standard loan. If the company qualifies for a loan in Finland with a reasonable rate, they may use the loan proceeds to buy out the factoring agreement. This returns full control of the sales ledger to the company and stops the factoring provider from contacting customers.

Early Repayment Regulations

While the Consumer Protection Act grants consumers the right to repay loans early without excessive costs, business loans are governed by the Promissory Notes Act (Velkakirjalaki) and the specific contract terms.

In floating-rate business loans, early repayment is usually permitted without penalty or with a minor administrative fee. However, for large fixed-rate commercial loans, the lender is entitled to an interest rate compensation (korkoero). This covers the difference between the agreed fixed rate and the current market rate for the remaining term. This compensation can be substantial. Business owners must request a payoff quote (poismaksulaskelma) before committing to refinance.

Assessing Lender Reputation

Before refinancing, it is prudent to research the potential new lender. In Finland, the banking sector is stable, but the non-bank lending sector is dynamic. Borrowers should check if the lender is registered with the Regional State Administrative Agency (Aluehallintovirasto) or supervised by the FIN-FSA.

Reviews and industry reputation matter. Some lenders are known for aggressive collection tactics or inflexible renegotiation policies. A reliable financial partner is crucial, especially if the business faces temporary headwinds in the future.

Refinancing and Tax Deductibility

Interest expenses on business loans are generally tax-deductible in Finland. This reduces the company’s taxable income. When refinancing, the deductibility continues with the new loan, provided the funds are used for business purposes.

However, Finland has limitations on interest deductibility (korkovähennysoikeuden rajoitus) for larger companies and intra-group loans. These rules are complex and generally apply to companies with net interest expenses exceeding €500,000. Small businesses rarely hit this threshold, meaning their interest costs remain fully deductible. Arrangement fees and other costs associated with raising finance are also deductible business expenses.

Preparation for the Application

To maximize the chances of approval for a business loan refinance, preparation is key. The company should ensure all tax filings are up to date. Any open balances with the Tax Administration (Verohallinto) should be paid or under a payment plan.

The entrepreneur should review their own credit data. A clean personal credit record is vital for smaller companies. If there are errors in the credit report, they should be corrected with Asiakastieto before applying.

The business bank account should show healthy activity. Lenders look for consistent revenue deposits and controlled expenses. Overdrafts should be managed within agreed limits. A history of returned payments or unauthorized overdrafts significantly reduces the likelihood of approval.

Timing the Refinance

The economic environment influences the optimal time to refinance. Monitoring the European Central Bank (ECB) announcements gives insight into the direction of Euribor rates. Refinancing ahead of anticipated rate hikes can lock in lower costs.

Internally, the best time to refinance is when the company’s financial metrics are strong. A year of record profits or a strengthened balance sheet makes the company an attractive borrower. Lenders compete for strong businesses, giving the borrower leverage to negotiate lower margins and better terms. Attempting to refinance when the business is already in a cash flow crisis is difficult and expensive.

Alternatives to Refinancing

If refinancing is not possible due to credit issues or lack of collateral, businesses may consider other options. Negotiating a payment holiday (lyhennysvapaa) with the current lender is a common first step. Finnish banks are often willing to grant interest-only periods to help companies through temporary liquidity crunches.

Another alternative is equity financing. Raising capital from investors avoids debt entirely but dilutes ownership. For short-term needs, a business credit card or a smaller loan in Finland might suffice, though these should not be used to service long-term structural debt.

Final Steps in the Process

Once a suitable offer is accepted, the new lender will issue a loan agreement. This is signed electronically. The new lender will typically request the payment details of the old loans. They will transfer the funds directly to the old creditors to ensure the debts are extinguished.

After the old loans are paid, the borrower should receive confirmation that the accounts are closed. If collateral was pledged, the old lender must release the security. The new lender will then register their claim on the collateral. This administrative transition is handled by the banks, but the business owner should monitor the process to ensure no lingering liabilities remain.