See What Invoice Finance Really Costs
Invoice finance can unlock cash tied up in receivables — but the true cost depends on advance rates, fees and how long customers take to pay. This calculator shows how much cash you can unlock from an invoice today and what it's likely to cost you by the time your customer pays.
Who it's for
Businesses that sell on terms and want to see, in dollar terms, how invoice finance will affect their cash flow and how much they'll pay in fees and discount/interest for early access to receivables.
What it calculates
Your upfront advance, the balance you'll receive when the customer pays, and the total cost of invoice finance (service/processing fees plus discount/interest) for a single invoice or batch over the expected payment period.
Why it matters
Invoice finance can be a powerful working-capital tool, but fees add up quickly on slow-paying debtors. Understanding effective cost helps you decide which invoices to fund, what terms to negotiate, and how this compares to overdrafts or loans.
Invoice Finance Cost Calculator
Invoice details
Single invoice or total value of a batch (incl. GST if your facility works that way).
From today until you expect the debtor to pay in full.
Facility structure
Typical range 70–90%.
Typically 1–3% of invoice amount.
Typical: 8–15% p.a. or 0.75–1.5% per month.
E.g. due diligence, account setup, debtor protection per batch.
Cash released & timing
Cost of invoice finance
2.76% of invoice · 3.24% of the advance.
Numbers stack up? Match the right facility.
If the cost and cash-flow benefit stack up for your invoices, the next step is to match the right invoice finance facility and provider to your debtor book.
How this Invoice Finance Cost Calculator works
You enter the value of the invoice or batch, how long you expect your customer to take to pay, and the key pricing levers: advance rate, service/processing fee and discount/interest rate. The calculator estimates how much you'll receive upfront, what you're likely to receive when the debtor pays, and the total cost of invoice finance over that period. It also shows an approximate effective and annualised cost on the funds advanced so you can compare invoice finance to alternatives like overdrafts or term loans.
Discount fee = Advance × Rate × (Days ÷ 365)
Total cost = Service fee + Discount fee + Other fees
The discount/interest is charged on the advanced amount (not the full invoice), and the service fee is calculated as a percentage of the invoice value. The rebate is the retained portion of your invoice (invoice minus advance) less total fees, paid to you when the debtor settles.
How to interpret your results
- Short-term gap, modest cost. When days-to-pay are short and total cost as a % of the invoice is low, invoice finance can be an efficient way to smooth cash flow and fund growth.
- Slow-paying debtors, rising cost. As days-to-pay increase, discount fees compound and effective costs rise. Invoice finance still may be worth it, but only if the extra liquidity meaningfully supports profitable growth or avoids more expensive alternatives.
- High costs relative to margin. If total fees consume a large slice of your gross margin on those sales, you might be better off improving payment terms, chasing collections harder, increasing prices or looking at different facilities.
- Treat outputs as estimates. Each provider may apply slightly different fee structures, minimums and timing rules.
How to check it fits your cash flow
Most invoice finance structures repay themselves when the debtor pays, rather than via fixed monthly repayments. To check affordability:
- Use the total cost as the implied "interest bill" for bringing cash forward, then compare it with your expected gross margin on the invoice(s).
- If your facility has line fees or minimum-usage charges on top of per-invoice cost, add those into the Working Capital Runway Calculator and check that combined cost fits your monthly cash-flow forecast at typical volumes.
- If you're also considering a term loan or overdraft alongside invoice finance, push the funding amount and term into the Business Loan Stress-Test and check that repayments plus invoice-finance costs together sit within a comfortable share of your cash flow.
Calculator assumptions
This calculator assumes a single average days-to-pay (no staggered tranches), discount/interest charged on the advanced amount only, and the service fee charged as a percentage of the full invoice value. Per-year discount rates use a 365-day basis; per-month rates use a 30-day basis. Real provider pricing may include line fees, minimum usage charges, debtor-protection costs, FX or transaction fees that aren't separately modelled here — use the 'other fees' field to approximate them. The annualised cost on the advance is a directional comparison figure, not a regulated comparison rate. This calculator does not constitute financial, tax or credit advice. Reviewed by the LoanGorilla editorial team — last updated May 2026.