Invoice Finance Calculator

Last updated: May 2026. Reflects current Australian metrics.

Don't wait 60 days to get paid. Calculate the upfront cash you can unlock through invoice factoring or discounting, and see the true cost of the facility.

Invoice Details

$
80% $40,000 upfront
Days
How long until your client actually pays the invoice?

Lender Fees

%
The interest charged on the advanced amount while waiting for payment.
%
A flat fee charged on the total invoice value.

Total Cash Unlocked

(Advance + Final Balance - Fees)

$0
Initial Cash Advance $0

Cost of Finance

Factoring/Processing Fee $0
Discount Rate (Interest) Cost $0
Total Fees Deducted $0
Final Payment to You (When client pays) $0

How Invoice Finance Works in Australia

If you run a B2B business (like labour hire, transport, or wholesale), you know the pain of 30, 60, or even 90-day payment terms. While you wait for your large corporate clients to pay their invoices, you still have to pay your staff wages and suppliers every week. Invoice finance bridges this cash flow gap.

Invoice Factoring vs Invoice Discounting

Factoring: The lender buys your invoice outright. They take over your accounts receivable and chase your client for the money. Your client will know you are using a factoring facility. This is often used by smaller businesses that don't have dedicated collections staff.

Discounting: The lender essentially gives you a loan secured against your invoices, but you maintain control of the collections process. Your client pays into a trust account, but they are generally unaware of the lender's involvement (it is 'confidential'). This is usually reserved for larger businesses with established credit management processes.

The True Cost

Invoice finance is generally more expensive than a standard secured bank loan, but it provides incredible flexibility because the credit limit grows automatically as your sales grow. There are usually two costs involved:

The Process

  1. You issue a $50,000 invoice to your client.
  2. The lender immediately advances you 80% ($40,000).
  3. Your client pays the full $50,000 invoice 45 days later to the lender.
  4. The lender takes the remaining 20% ($10,000), subtracts their fees and interest, and remits the final balance to you.

Related Calculators

Business Loan Equipment Finance Invoice Finance

Read official business finance guidelines at Business.gov.au.

10 Frequently Asked Questions

1. What is Equipment Finance?
Equipment finance (like a chattel mortgage) allows a business to borrow money to buy an asset, using the asset itself as security.
2. How does Invoice Financing work?
Invoice financing lets you borrow money against the amounts due from your customers, freeing up immediate cash flow.
3. What is an Unsecured Business Loan?
A loan that doesn't require collateral. It usually has higher interest rates and shorter terms due to the higher risk for the lender.
4. Can I claim the interest on a business loan?
In Australia, interest incurred on loans used strictly for business purposes is generally tax-deductible. Check with the ATO.
5. What is the instant asset write-off?
An ATO measure allowing businesses to claim an immediate deduction for the business portion of the cost of an asset in the year it is first used.
6. What is a line of credit?
A flexible loan where you are approved for a certain limit but only pay interest on the funds you actually draw down.
7. Are Directors Guarantees required?
Most lenders will require a personal guarantee from the company directors, even for unsecured business loans.
8. What is a Chattel Mortgage?
A commercial loan product where the financier advances funds to purchase an asset, taking a mortgage over it as security.
9. How do lenders assess business loans?
Lenders look at trading history, cash flow, BAS statements, and business credit scores.
10. Does a business loan affect my personal credit?
If you provide a personal guarantee or are a sole trader, defaults will negatively impact your personal credit file.