Cash from unpaid invoices
Invoice Finance
Invoice finance lets a business borrow against invoices its customers haven't paid yet. A lender advances most of the invoice value within days, then releases the rest, minus its fees, when your customer pays.
For a full comparison of invoice factoring, invoice discounting and single invoice finance, our sister site InvoiceWise specialises in exactly that. You can also start here and we'll pass your enquiry on.
- Up to 90% of invoice value upfront
- Grows with your sales
- Confidential options available
Reviewed by the Funding Plus team · Last updated October 2026
Step 1 of 3 · Invoice Finance
How much do you need?
Takes about a minute. No impact on your credit score.
Invoice Finance at a Glance
- Advance
- Up to 90%
- Facility size
- £10k – £10m+
- Set-up
- 1 – 3 weeks
- Security
- Your invoices
- Best for
- B2B businesses
Typical figures across the market. Your offers depend on your business, the lender and the security available.
How Invoice Finance Works
- 1Raise an invoiceInvoice your business customer as normal, on 30 to 90-day terms.
- 2Get an advanceThe lender pays you most of the invoice value, usually within 24 to 48 hours.
- 3Your customer paysEither to the lender (factoring) or to you as normal (discounting).
- 4Receive the balanceThe lender releases the rest of the invoice, minus its fees.
How Much Does Invoice Finance Cost?
Invoice finance usually has two charges: a service fee for running the facility and a discount charge, like interest, on the money advanced. The cost depends on your turnover, your customers' credit and whether the lender handles collections.
- A service fee, often a percentage of turnover
- A discount charge on funds drawn
- Optional bad debt protection
- Minimum terms and exit fees on some facilities
Worked example
A £20,000 invoice on 60-day terms
- Invoice value
- £20,000
- Advance (85%)
- £17,000
- Fees (2.5% of invoice)
- £500
- Balance paid when customer pays
- £2,500
- Total received
- £19,500
Illustrative only, not a quote. Fees vary by lender and facility.
Who Can Get Invoice Finance?
- You sell to other businesses or the public sector on credit terms
- Invoices for goods or services already delivered
- Customers with a reasonable credit record
- Usually a UK limited company or LLP
- No serious disputes with your customers
What You'll Need to Apply
- Aged debtor and creditor reports
- Sample invoices and customer contracts
- Latest accounts
- Business bank statements
Pros and Cons of Invoice Finance
Advantages
- Funding grows as your sales grow
- Based mainly on your customers' credit
- No property needed as security
- Confidential options keep it private
Things to watch
- Only for B2B or public sector sales
- Fees can add up on long-running facilities
- Some facilities have minimum terms
- With factoring, the lender contacts your customers
Types of Invoice Finance
Invoice factoring
The lender runs your credit control and collects payment from customers.
Compare factoring on InvoiceWiseInvoice discounting
You keep collecting payments yourself, usually confidentially.
Compare discounting on InvoiceWiseSingle invoice finance
Fund one invoice at a time, with no long-term contract.
Compare single invoice financeInvoice Finance vs Other Options
| Option | Best for | Typical speed | Security |
|---|---|---|---|
| Invoice finance | B2B firms waiting to be paid | 1 – 3 weeks to set up | Your invoices |
| Business line of credit | General cash flow gaps | 1 – 5 days | Usually none |
| Unsecured business loan | One-off costs | 1 – 5 days | None (guarantee usual) |
| Trade and stock finance | Paying suppliers upfront | Days to weeks | The goods |
Who Uses Invoice Finance?
Invoice finance suits businesses that invoice other businesses and wait to be paid.
Customer story
“[Real customer story for Invoice Finance: what they needed, how quickly it was arranged and what it let them do.]”
[Name], [Role], [Business name] · [Amount] invoice finance
Invoice Finance FAQs
What's the difference between factoring and discounting?
With factoring, the lender collects payment from your customers. With discounting, you collect payment yourself and customers usually don't know you use finance.
Will my customers know?
With factoring, yes. With confidential invoice discounting, usually not.
How much can I get?
Typically up to 85% to 90% of the value of approved invoices.
Can I finance just one invoice?
Yes. Single invoice finance lets you fund individual invoices without a long-term facility.
Who is InvoiceWise?
InvoiceWise is our sister site, specialising in comparing invoice finance. [Confirm the relationship wording before launch.]
Related Guides
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