Invoice & Debtor Finance Calculator

Almost every invoice finance calculator online is run by a lender or a broker, and they all do the same small sum: invoice value, multiplied by a fee rate, multiplied by an advance rate. That tells you roughly what one invoice costs. It doesn't tell you the two things that actually catch businesses out.

The first is timing. Invoice finance pays you twice, not once: an advance now, then the rest of the invoice — the reserve — minus charges, whenever your customer finally pays. Those are two separate cash events, often two or three months apart, and your cash flow forecast is fiction unless it treats them separately.

The second is the recourse clock. Fund an invoice and you have a deadline: if your customer hasn't paid within the recourse period, that invoice drops out of your funding base. Your available funds shrink and nothing bounces, no letter arrives — the number in the lender's portal just goes down. The tracker tab here rebuilds that calculation from your own ledger so you can see it coming.

In Australia the umbrella term is debtor finance, and it covers the same two products the rest of the world calls factoring and invoice discounting.

With factoring you sell the invoice and the financier takes over collections: your customer is notified and pays them directly. It suits smaller businesses without a dedicated credit-control function, and the higher service fee reflects that the financier is doing that work.

With invoice discounting — often called confidential debtor finance here — you borrow against the ledger, keep collections in-house, and your customer usually never knows. Payments are directed to a trust account in your company's name that the financier controls.

One mechanic that is distinctly Australian: the financier will almost always register a security interest against your company on the PPSR. That registration is public, so a prospective lender or a major customer running a PPSR search will see it. It is routine and not a red flag, but be ready to explain it, and check whether the registration is limited to the receivables or is an all-present-and-after-acquired-property claim, because the latter can complicate any future equipment or working-capital facility.

UK facilities usually have two charges, which is why comparing them against a single headline percentage is so misleading.

The service fee (or administration fee) is a percentage of the invoice value, typically between 0.5% and 3% depending on turnover, sector and whether the lender is doing your credit control. It's charged on everything that goes through the facility, whether or not you draw the money.

The discount charge is interest on the money you've actually drawn, quoted as a margin over base rate and accruing daily. Two facilities with the same service fee can differ a lot here, especially if your customers are slow, because you pay for every extra day the advance is outstanding.

Then there are the extras that never appear in the headline rate: arrangement or set-up fees, CHAPS and same-day payment charges, audit or survey fees, and refactoring charges on invoices that go past their recourse date. Switch the calculator to the two-part option to model this properly, and put your CHAPS charge in the fixed-charges box — on a small invoice it can matter more than the rate.

A 1.5% fee sounds cheap next to an overdraft at 9.5% a year. They aren't comparable, because the 1.5% buys you about 60 days of money and the 9.5% buys you a year of it.

To compare them, annualise. Take the total charges, divide by the cash you actually received, then scale by 365 divided by the days the money was outstanding. Financing a £50,000 invoice for £1,500 in charges with a £42,500 advance over 60 days is a 3% cost of that invoice — but about 21% a year. That is the figure to hold next to your overdraft rate.

This isn't an argument against invoice finance. It's frequently the right call: it scales with your sales, it doesn't need the security a term loan needs, and being able to pay staff this month is worth real money. But you should know which number you're comparing, and the calculator shows both.

Almost all Australian debtor finance is recourse finance. If your customer doesn't pay within the recourse period — commonly 90 days, and usually counted from the invoice date or the end of the invoice month — the invoice becomes ineligible, drops out of the funding base, and your availability falls by that invoice's value times your advance rate.

That wording matters. Check whether your agreement runs the clock from the invoice date, the due date, or month end, and set the tracker to match: on 30-day terms the three conventions can be six weeks apart.

The local context is that slow payment by large businesses is a structural problem, which is exactly why the Payment Times Reporting Scheme requires large businesses to publicly report how quickly they pay small suppliers. Those reports are searchable, and they are genuinely useful before you take on a big customer whose invoices you intend to finance: a debtor that reports 60-plus day averages will push against a 90-day recourse clock every single month. The deadline board sorts your invoices by how soon they age out and shows the funding at stake on each.

The availability figure in your lender's portal isn't your ledger times the advance rate, which is why it so often reads lower than expected. It's a sequence of deductions, and the order matters:

Start with the outstanding invoices you've assigned to the facility. Take out the disapprovals — anything past the recourse period, in dispute, and depending on your agreement, overseas debtors, related-party invoices, or customers over their credit limit. What's left is your eligible ledger.

Now apply the concentration limit. Most facilities cap how much of the funding base any single customer can represent — 25% to 50% is typical. If your eligible ledger is £100,000 with a 50% cap and one customer owes £60,000, then £10,000 of that customer's debt is excluded. The cap is applied to the ledger after disapprovals, not before, so an aged invoice elsewhere can quietly tighten the cap on your biggest customer.

Multiply what survives by your advance rate for gross availability, cap it at your facility limit, then subtract funds in use — what you've already drawn. That's what you can actually take today. The tracker shows every line of this with the reason attached, which is the part the client statement leaves you to work out yourself.

There's no bank feed and no lender integration here, and that's deliberate — for invoice discounting, a bank feed wouldn't help. Your customers pay into the trust account, not your current account, so your bank statement shows lender sweeps and releases in lump sums that don't correspond to individual invoices. The datasets that answer the real questions are your invoice ledger and one figure off your lender statement.

So: set your facility terms once from your agreement, import your outstanding invoices from a Xero, QuickBooks or Sage CSV export (upload it and pick which column is which), and type in your current funds in use. Mark invoices paid as they settle. That takes a few minutes a week and gives you the availability figure, the recourse deadlines and the forward cash curve.

It also learns. Once you've marked a few invoices paid, the tool works out each customer's real average time to pay and uses that for the forecast instead of your agreed terms — so a customer who reliably pays at day 75 on 60-day terms is forecast at 75. Everything is stored in this browser only; use the backup button to move it to another machine.