How much does invoice finance cost?

Invoice finance pricing is generally structured around two main components.

1. The Service Fee (or Admin Fee)

This can cover administration and, for factoring, credit-control services. A provider may calculate it against assigned turnover or use another basis stated in the quotation.

• Factoring: The fee may reflect the provider's credit-control and ledger-management work.
• Discounting: Your business retains credit control, but minimums, audits and other charges may still apply.

2. The Discount Charge (Interest)

This is commonly an annual rate linked to a stated base rate and applied to funds in use. The agreement controls the exact basis, frequency and margin.

Methodology reviewed 9 September 2026: examples on this page are hypothetical calculations for explaining fee mechanics, not current provider quotations or market ranges. They assume a constant average balance and exclude VAT and any charges not expressly listed.

The service fee and discount rate may not represent the complete cost. Review the quotation and agreement for additional charges.

• Minimum service fees: Confirm the minimum amount and period even if turnover falls below forecast.
• Payment and drawdown fees: Confirm whether transfers attract a charge and model the expected number of transfers.
• Audit and survey fees: Check expected frequency, day rates, expenses and triggers for extra audits.
• Overdue-invoice charges: Ask what happens when an invoice remains unpaid beyond the agreed funding period.
• Bad-debt protection: Confirm the premium, exclusions, limits, waiting periods and disputes treatment.