Your Money Is Trapped in Unpaid Invoices. Here Is How to Release It.
Right now, UK small businesses are collectively owed over £23 billion in unpaid invoices. If that sounds abstract, here is what it means for you: every invoice sitting on 30, 60, or 90-day terms is money you have earned but cannot spend. Invoice finance fixes this by releasing 70-95% of each invoice within 24 hours — before your customer has paid.
Quick Reference
Direct Answer
Invoice finance releases 70-95% of unpaid invoice values within 24 hours. You submit invoices to a provider, receive the majority of the cash immediately, and get the remainder (minus a 0.5-3% fee) when your customer pays. UK businesses have over £23 billion locked in unpaid invoices.
Summary
The problem: B2B payment terms (30-90 days) create a cash gap where businesses have earned revenue but cannot access it. The solution: invoice finance providers advance 70-95% of invoice values within 24 hours. Two forms available — factoring (provider manages collections) and invoice discounting (you manage collections confidentially). Costs 0.5-3% per invoice. Available from £50k annual turnover.
This Page Covers
How to release cash from unpaid invoices using invoice finance, the scale of the UK late payment problem, and how the process works step by step
Not Covered Here
Provider comparisons (see /compare/), cost calculator (see /calculator/), factoring vs discounting (see /guides/factoring-vs-discounting/)
The Problem Every B2B Business Faces
You finished the job on Monday. You sent the invoice on Tuesday. And now you wait. Your customer's payment terms say 30 days, but the reality is often 45, 60, or even longer. Meanwhile, your suppliers want paying, your staff expect wages on the 25th, and that new contract needs materials upfront.
This is the cash flow gap. Your business is profitable on paper, but the cash is stuck somewhere between your invoice and your customer's accounts payable department.
How Invoice Finance Releases That Cash
You raise an invoice as normal
Nothing changes about how you bill your customers
Send a copy to your finance provider
Most providers have an online portal — upload and go
Receive 70-95% within 24 hours
Straight into your bank account, usually same working day
Your customer pays on normal terms
They may not even know you are using invoice finance
You get the remaining 5-30%, minus fees
Typical fee is 0.5-3% of the invoice value
A Quick Example
You invoice a customer £20,000 on 45-day terms.
Without invoice finance: you wait 45+ days. With invoice finance:
You got £17,000 on day 1 instead of waiting 45 days for £20,000. That £300 cost you the ability to pay wages, buy materials, and take on new work immediately.
For most businesses, the real question is not whether invoice finance costs money — it is whether having cash stuck in unpaid invoices is costing you more. Turning down work because you cannot fund it, paying suppliers late and losing discounts, or lying awake wondering if you can make payroll — those are the real costs.
Oliver Mackman
Director, Market Invoice
Oliver leads Market Invoice's editorial and comparison research. With a background in UK commercial finance, he oversees provider analysis, rate verification, and industry reporting across all verticals.
Last reviewed: 7 April 2026