Invoice finance in Australia

How does invoice finance work?

Invoice finance uses your outstanding customer invoices as the basis for a cash advance. When you invoice a customer on 30, 60 or 90 day terms, you submit the invoice to a finance provider instead of waiting, and the provider advances a percentage of its value.

The provider verifies the invoice and advances up to 80% of its value; Fifo Capital publishes same-day advances and Earlypay aims to advance within 24 hours of approval. When your customer pays on their normal terms, the provider releases the remaining balance to you, minus its fees.

The cycle repeats, so the facility grows in proportion to your invoicing. As you win more work and issue more invoices, the funding available increases without a new loan application.

Which lenders offer invoice finance, and on what terms?

The specialists publish their advance rates and floors; the banks offer debtor finance through their business banking relationships and do not publish product terms. Checked against each provider's published page on 20 September 2026, with Earlypay and Fifo Capital re-checked on 30 September 2026. Terms change without notice; confirm the current position with the provider or your broker before relying on it.

What does invoice finance cost?

Earlypay publishes interest of 7.99% to 13.95% p.a. on the balance drawn, plus drawdown or administration fees depending on the facility. On $100,000 advanced for 60 days that is about $1,313 to $2,293 in interest before fees, because you pay only while the invoice is outstanding. Earlypay also notes that invoice finance costs more than finance secured by property.

Because the balance clears when each invoice is paid, the cost follows how long your customers take. A customer who pays in 30 days costs half as much interest as one who takes 60.

What types of invoice finance are there?

Factoring

You sell your invoices to the provider, which collects payment from your customers. business.gov.au describes it as selling unpaid invoices to another business at a discount, with the buyer responsible for chasing the debt. Customers know about the arrangement and pay the provider.

Invoice discounting (confidential)

The same advance, but you keep control of collections and the invoices are security rather than sold. Customers pay you as normal. Earlypay publishes that confidential facilities are generally offered to businesses with a strong track record.

Selective invoice finance

You choose which invoices to fund rather than the whole debtor book. Fifo Capital publishes that you can fund one invoice or many, which suits accelerating payment on a few large invoices.

Supply chain finance

A variation arranged by your large customer, letting its suppliers (including you) receive early payment based on the customer's credit strength rather than yours.

What are the risks of invoice finance?

• Cost. Interest plus drawdown or administration fees can make it dearer than a secured loan; Earlypay notes that it costs more than finance secured by property.
• Bad debts. Ask whether the facility is with or without recourse. With recourse, if a customer does not pay, you repay the advance.
• Customer relationships. With a disclosed facility the provider contacts your customers about payment.
• Concentration limits. Some providers cap how much they fund against a single customer, so one large debtor may not be fully funded.
• Contract terms. Check for a minimum term or exit fees; Fifo Capital publishes no fixed term contracts.

Which businesses does it suit?

Any B2B business with regular invoicing on terms, and some more than most:

• Construction and trades: Long payment cycles and progress payments make invoice finance valuable for maintaining cash flow between payments.
• Transport and logistics: Fuel, maintenance, and driver costs occur immediately but freight invoices may not be paid for 30 to 60 days.
• Manufacturing: Raw material costs must be paid upfront while finished goods are invoiced on terms.
• Labour hire and recruitment: Staff wages are paid weekly while client invoices may be on 30 or 60-day terms.
• Professional services: Consulting, legal, and accounting firms that invoice monthly or on project completion.
• Wholesale and distribution: Businesses that purchase stock upfront and sell on credit terms.

Invoice finance or a business loan?

Invoice finance does not create a fixed debt with a repayment schedule: the funding is tied to your invoices and clears as customers pay. The assessment is different too, resting largely on the quality of the businesses you invoice rather than only on your own credit and security.

A term loan suits a one-off purchase; invoice finance suits a recurring gap between doing the work and being paid. If the gap is buying stock before you sell it, trade finance is the matching tool, and many businesses run the two together.