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What it means
Interest cover divides operating profit (before interest and tax) by the interest charge. A cover of 4 means profit is four times the interest bill — plenty of headroom. A cover near 1 means almost all profit goes on interest, leaving nothing for a bad month. Work it out with the interest-cover calculator.
What this means for your company
Lenders watch interest cover as an early strain signal, and it complements the debt-service coverage ratio (which also counts capital repayments). Falling cover is a prompt to slow further borrowing. Credicorp assesses affordability from real cash flow, not a single ratio, so a lean year does not rule you out — but knowing your own cover keeps you honest about how much debt the business can carry.
What it means for you
Credicorp lends to your company, not to you personally, and takes no personal guarantee. See business loans or apply online.
Frequently asked questions
What is a healthy interest cover ratio?
Above 2–3 times is generally comfortable, meaning profit comfortably exceeds the interest bill. Below 1.5 is a warning that little cushion remains if profit dips. The right level depends on how stable your income is.
How is interest cover different from DSCR?
Interest cover measures profit against interest alone. Debt-service coverage measures cash against interest plus capital repayments, so it is stricter. Lenders often look at both together.
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Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.