Your buffer decides what this hike costs you

Earlier today, the RBA raised the cash rate by another 25 basis points, taking it to 4.60% [1]. This is the fourth rise this year, and if you run a small business, you’ve probably had to adjust more than once already, with new prices, renegotiated supplier terms or a harder look at what investments can wait.

The RBA's 25 basis point rise is the same number for every business. But what it costs you, specifically, depends on your debt, your cash flow, and the buffer sitting between them.

The bigger risk is waiting for the higher repayment to show up in the bank feed before running the numbers, reacting to the new cost instead of planning around it. You can run those numbers now, before the higher cost starts flowing through your facilities.

Checking what your buffer can actually take

Look at one loan on its own and a 25 basis point rise seems small, maybe a few hundred dollars a month. But that number means very little by itself because it ignores what customers pay you and when, supplier prices, any tax bills due in the next few months, and every other facility repricing alongside this one.

The number worth trusting is what’s left in your account once all that clears, every month, for the next six months to a year. The exercise is simple: run your cash flow again assuming rates hold here or rise once more. If your buffer survives those scenarios, this hike alone won't force a decision. If there’s a gap, you’ve got time to do something about it.

Working out what your debt is doing for you

Some of what you owe is earning its keep: funding stock, payroll, marketing or equipment that brings in more than it costs to hold. But there’s also the debt that’s just sitting there, getting a little more expensive every time the cash rate moves, without adding much value at all.

That “more expensive” part isn’t automatic, though. Henry Baker, Valiant’s Chief Sales Officer, sees business owners assume every facility moves in lockstep with the RBA. “That's often not the case,” he says. “Some lenders absorb part of the increase to support their customers, and some facilities are fixed or hedged, so the rate doesn't change at all.”

A rate rise is a good moment to check which is true for you: which facilities are repricing, what’s up for renewal in the next year, and do the assets behind each one still earn more than they cost to carry.

As Baker puts it, “it's worth having a broker review your current debt, so you know exactly where you stand and that you're set up for success.”

Weighing the cost of waiting

After a rate rise, the instinct is to pause non-essential investments like hiring, new equipment or tech upgrades until things settle. But that pause has its own cost. In some cases, a missed return can outweigh the hike’s added repayments.

Take a $400,000 facility, fully drawn, with the entire rise passed through at 4.60%. The hike adds around $1,000 a year in interest, or $500 over six months. Now take a $20,000 equipment upgrade sitting on the shelf, expected to save around $500 a month once it’s running: roughly $3,000 over that same six-month stretch. 

If the numbers hold, waiting six months to see where rates land would cost $3,000 in savings to avoid $500 in additional interest. The delay costs more than the rate rise.

“The owners who are ambitious, hard working and running lean have generally held up well through the turbulence of 2026, and many are expanding,” Baker says. “That said, it's never a bad idea to take stock of your financial position before committing to a big project or investment. Keep your accountant, broker and advisor on speed dial.”

That’s the exercise above, in practice: running the numbers before you decide what makes sense for your investment specifically.

Knowing your options before you need them

Understanding where you stand costs you nothing while you still have room to choose. That means reviewing what you’re paying across existing facilities, checking whether refinancing or consolidating puts you ahead, and getting a realistic read on your borrowing capacity, without a credit check touching your file until you’re ready for final quotes.

Talk to one of our brokers about what this hike means for your financing and find out what your options look like.