Home › Guides › Invoice finance calculator
Invoice finance calculator
See how much cash an invoice releases now, what the service fee and discount charge come to, and what you receive when your customer finally pays.
The starting figures are an example to show how the sum works, not market rates. Replace them with the numbers from a provider’s quote.
Want a specialist to search the market for you?
Tell us about your company and what you need. With your consent, a specialist business finance broker contacts you and does the searching. Free to use; we may be paid by the broker for the introduction.
Illustrative only, not an offer. These figures are arithmetic on the numbers you enter. A lender sets your actual rate, fees and terms on application, and its own quote is the only figure that binds. Nothing you type into this calculator leaves your browser.
How the calculation works
- Cash now = invoice value × advance percentage.
- Service fee = invoice value × service fee percentage.
- Discount charge = cash advanced × yearly discount rate × days outstanding ÷ 365. It is interest, so it grows the longer your customer takes to pay.
- Paid to you on settlement = invoice value − cash advanced − fees.
The last line, cost per year on the money advanced, turns the fees into a yearly rate so you can set invoice finance against a loan or overdraft on a like-for-like basis.
What the calculator leaves out
Real facilities can include set-up fees, minimum monthly fees, charges for credit checks on customers, bad debt protection premiums and termination fees. Ask for every charge in writing and add them to the total. The invoice finance comparison lists each provider’s published advance and terms, and our guide to invoice factoring explains the products.
Frequently asked questions
Why does the discount charge depend on days?
Because it is interest on the money advanced for the time it is outstanding. If your customer pays in 30 days rather than 60, the discount charge roughly halves.
What is a typical advance?
Providers set it per business. Several publish a maximum, shown in the invoice finance comparison table; the figure you are offered may be lower.
Is the service fee charged on the advance or the invoice?
Usually on the invoice value or the turnover put through the facility, which is how this calculator treats it. Check your quote, as structures vary.