Invoice finance for design and creative agencies
Yes, design and creative agencies can use invoice finance, as long as they invoice other businesses. Once a client has signed off the work and you have invoiced it, a lender pays you most of the invoice straight away. You get the rest, minus fees, when the client pays. It won't fund work still waiting for sign-off, or a retainer billed for next month's work.
This matters for creative businesses because you often pay staff and freelancers for weeks before the final invoice can go out, and then wait again for the client to pay. The same applies to branding, web design, video, photography, marketing and other creative industries businesses.
How agency invoices fit invoice finance
| Type of invoice | Usually fundable? | Why |
|---|---|---|
| Stage or final invoice after written sign-off | Yes | The work is done and accepted, so the client owes the money |
| Retainer billed at the end of the month for that month's work | Yes | The work has been done |
| Retainer billed in advance | Often not | The work has not been done yet, so the client could refuse to pay |
| Deposit invoice before the project starts | Usually not | Nothing has been delivered |
| Media or production costs you pass on to the client | Sometimes | The client owes it like any other invoice, but some lenders limit how much they lend against one client, and a big media bill can use up that limit |
Each lender sets its own rules, so ask which of your invoice types it would fund before you sign. Changing how you bill can help: smaller stage invoices signed off as you go can be funded sooner than one large invoice at the end.
A worked example
A client signs off a website build and you invoice the final £20,000 on 45-day terms. These are made-up figures, not a quote. The 85% advance and 1% service charge are example figures. Bibby says it advances up to 95% of the invoice value (read 1 Nov 2026); lenders do not publish their service charges. The discount charge is 6.75% a year: the Bank of England base rate (4%) plus 2.75%, the margin UK broker ABC Finance uses in its own cost example.
| Paid to you when you invoice (85%) | £17,000 |
| Discount charge: 6.75% a year on £17,000 for 45 days | £141 |
| Service charge: 1% of the invoice | £200 |
| Paid to you when the client pays (£3,000 less charges) | £2,659 |
| Cost of getting £17,000 forty-five days early | £341 |
If you only have one or two big invoices a year, selective invoice finance lets you fund just those, usually without a long contract. It costs more per invoice than a facility covering all your invoices. Try your own figures in the calculator.
Before you take on a client with long terms
Invoice finance charges run for as long as the invoice is unpaid, so the discount charge on an invoice paid in 90 days is about twice the charge on one paid in 45 days. If the client is a large business, check how many days it takes on average to pay its suppliers on the government's payment practices service (GOV.UK). GOV.UK says large businesses must publish this at least twice a year.
Factoring or invoice discounting?
With factoring the lender chases your clients, so they know it is involved. With invoice discounting you chase them yourself and they usually don't know. Factoring costs more because the lender does the chasing (ABC Finance). Many lenders also ask for a minimum turnover. ABC Finance puts the usual minimum at £250,000 to £500,000.
Lenders' published terms
| Lender | Published minimum turnover | Paid up front | Source |
|---|---|---|---|
| Hydr | None published (single invoices) | Up to 100% per invoice | hydr.co.uk |
| Ultimate Finance | None published | Up to 95% | ultimatefinance.co.uk |
| Bibby Financial Services | None published | Up to 95% | bibbyfinancialservices.comread 1 Nov 2026 |
| Time Finance | None published | Up to 90% | timefinance.com |
| Close Brothers Invoice Finance | £750k | Up to 90% | closeinvoice.co.ukread 1 Nov 2026 |
Figures as published on each lender's own website (each check is dated in our Rate Index). Where a source shows a date, we read that page on that day, and our page on the lender quotes what it said. Most of these lenders do not publish their fees.
More lenders are in the list of UK invoice finance companies. See also invoice finance for marketing agencies.
Questions
Will my clients know I use invoice finance?
With factoring, yes, because they pay the lender and the lender chases them. With confidential invoice discounting they usually won't. If that matters to you, ask for discounting, but some lenders only offer it above a set turnover.
I'm a freelancer, not a limited company. Can I use it?
Some lenders work with sole traders. See our guide for sole traders.
What if a client disputes a funded invoice?
The lender usually stops funding it and you repay the advance on that invoice. Written sign-off of each stage and a clear scope of work make disputes less likely and easier to settle.
Can I fund a client who is overseas?
Only with lenders that fund export invoices, or if the debt is insured. Ask before you apply.
Freelancers: invoice finance for sole traders.
Founder & Managing Director, Muswell Rose, founder and PSC of Best Business Loans Ltd
Adam was managing director of Penny, a UK invoice finance business, from July 2020 to November 2023. His career runs through insurance, mortgages, commercial finance and fintech lending. He writes the Market Invoice library. Career record.
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