Invoice Finance Cost Calculator
Estimate your monthly invoice finance costs based on your turnover, advance rate, and payment terms. Adjust the inputs to see how different scenarios affect your costs.
Invoice Finance Cost Calculator
Estimate your monthly invoice finance costs in 30 seconds
Your Estimated Costs
These are estimates. Actual costs vary by provider. Get 3 free quotes for accurate pricing.
How Invoice Finance Costs Are Calculated
Invoice finance has two main costs. The service charge (0.5-3% of invoice value) covers administration and credit control. The discount charge (base rate + 1-3%, charged daily) is interest on the amount advanced. Total monthly cost depends on your invoice volume, advance rate, and how quickly your customers pay.
For example, a business with £50,000/month in invoices, an 85% advance rate, 1.5% service charge, and 6.5% discount charge with 45-day terms would pay approximately £909/month — or 1.8% of turnover.
The fastest way to reduce costs is to improve your debtor quality (blue-chip customers attract lower rates) and reduce payment days. See our full costs guide for detailed strategies.
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Cost Calculator FAQ
How accurate is this calculator?
This calculator provides estimates based on typical market rates. Actual costs vary by provider, your industry, debtor quality, and facility size. Use it for budgeting, then get real quotes for accurate pricing.
What is the service charge?
The service charge covers administration, credit checks, and (for factoring) credit control. It is charged as a percentage of the gross invoice value, typically 0.5-3%. Larger facilities get lower rates.
What is the discount charge?
The discount charge is effectively interest on the money advanced to you. It is quoted as a percentage above Bank of England base rate and charged daily on the outstanding advance until your customer pays.
How can I reduce my invoice finance costs?
The main ways to reduce costs are: increase your turnover volume, improve debtor quality (blue-chip customers), reduce average payment days, negotiate longer contract terms, and compare multiple providers to leverage the best rates.