Working Capital Calculator · India
Work out your net working capital, current ratio and operating cycle in seconds — the exact figures a bank wants before sanctioning a working capital loan or cash credit limit. For traders, manufacturers and MSMEs.
Current assets
What you own / are owed within a year.
Current liabilities
What you owe / must pay within a year.
Operating & cash conversion cycle
How many days your cash stays locked in the business. Enter the three figures below.
Working capital & operating cycle — what a lender checks
Before any bank sanctions a working capital loan or cash credit (CC) limit to a trader or manufacturer in India, it looks at three things: your net working capital, your current ratio, and how long your money stays tied up — the operating cycle. This free calculator works out all three from your own figures, so you can check your position before you apply.
Net working capital
Working capital = Current assets − Current liabilities
Positive working capital means you can comfortably cover short-term dues; negative means liabilities exceed liquid assets, a warning sign for lenders. Current assets are cash, debtors, inventory and prepaid items; current liabilities are creditors, short-term loans, and taxes or dues payable within a year.
Current ratio and quick ratio
Current ratio = Current assets ÷ Current liabilities. A ratio of 1.5–2 is usually seen as healthy. The quick ratio removes inventory (the hardest asset to convert to cash quickly) to give a stricter test of liquidity — useful because banks discount slow-moving stock.
Operating cycle & cash conversion cycle
Operating cycle = DIO + DSO and Cash conversion cycle = DIO + DSO − DPO, where DIO is inventory days, DSO is receivable (debtor) days, and DPO is payable (creditor) days. A shorter cycle means your cash returns faster and you need less working capital. Stretching supplier credit (higher DPO) or collecting from customers sooner (lower DSO) shrinks the gap your loan has to fund.
Why it matters for loans
Lenders often size a working capital limit as a portion of your operating-cycle needs. Showing a healthy current ratio and a tight cash conversion cycle improves both your chances of approval and the limit you are offered. Use this tool to spot weak points — too much idle stock, slow collections — before the banker does.
Frequently asked questions
How is working capital calculated?
Working capital = current assets − current liabilities. Add up cash, debtors, inventory and prepaids for assets, and creditors, short loans and dues for liabilities.
What current ratio do banks want?
Generally 1.33 or above for working capital finance, with 1.5–2 considered comfortable. Below 1 signals liquidity stress.
What is the cash conversion cycle?
It is inventory days plus receivable days minus payable days — the number of days your cash is locked in operations before it comes back.
Is this tool free and private?
Yes — completely free, no sign-up, and everything runs in your browser. Nothing you enter is stored or uploaded.