Invoice & Debtor Finance Calculator
Invoice finance advances a percentage of your unpaid invoices now, and pays the balance when the customer settles. This calculator shows the cash released, the total fee and - most importantly - the effective annual rate, which is usually far higher than the headline discount rate suggests.
Your details
Percentage paid to you upfront
Interest charged on funds drawn
Percentage of invoice value
| Invoice value financed | $500,000 |
| Advance rate (80%) | $400,000 |
| Retained until the customer pays | $100,000 |
| Discount charge over 45 days | $4,685 |
| Service fee (1.5% of invoice value) | $7,500 |
| Total cost | $12,185 |
| Net you receive in total | $487,815 |
| Cost as a % of the cash advanced | 3.05% |
| Effective annual rate | 24.7% |
| Cost per $100,000 of invoices | $2,437 |
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Frequently asked questions
Why is the effective rate so much higher than the discount rate?
Because the service fee is charged on the full invoice value but you only receive the advance, and the cost is incurred over a short period. Annualising a 1.5% fee earned over 45 days produces a large number.
Is invoice finance worth it?
It can be when the alternative is turning away work you cannot fund, or when it unlocks supplier discounts worth more than the fee. Compare it against an overdraft on the same drawn balance.
General advice warning: This calculator provides general information only. It does not take into account your objectives, financial situation or needs, and it is not personal credit or financial advice.
Results are estimates based on the inputs and assumptions shown. Any interest rate used is an example and is not an offer of credit. Speak to a licensed credit representative before acting on these figures.