Invoice finance
$50,000 to $100,000,000+ for the right business, released against invoices you’ve already sent. With the right lender it’s connected to your accounting software, not a stack of paperwork.
General information only
Invoice finance in Australia releases cash tied up in unpaid customer invoices. Instead of waiting 30, 60 or 90 days to get paid, you get a large share of the invoice value upfront, with the invoice itself as security rather than property. It’s built for businesses that invoice other businesses and need the gap between invoicing and getting paid to stop being a cash flow problem.
The biggest misconception is that it’s hard work: a pile of paperwork every time you draw. With the better lenders on our panel, you connect your accounting software once and cash releases against new invoices without you resubmitting anything.
How does invoice finance work?
You issue an invoice as normal, submit or sync it with the lender, and receive an advance (typically 80% to 90% of the invoice value) within a day or two. When your customer pays, the lender releases the rest, minus their fee. If your Xero or MYOB is connected to the lender, the submit step disappears and eligible invoices are advanced as they’re raised.
- 01Integration. With certain lenders, your accounting software connects straight to the facility.
- 02Disclosure. Whether your customers know depends on the lender and structure, not the product. Some require it. Others run confidentially.
- 03Security. As with our other products, the cheaper the rate, the more guarantees or security a lender will want.
- 04Cost. It isn’t automatically more expensive than other finance, and unlike a term loan you draw against it when you need to, not on a schedule.
Share of Australian SMEs hit by significant cash flow pressure in the past 12 months, per CommBank and UNSW.
Sourced data: CommBank / UNSW
How widespread is the cash flow gap invoice finance solves?
Wider than most owners assume. Separate research puts 15% to 27% of SMEs holding minimal or no cash buffer at all, and debtor days across Australian SMEs commonly run 45 to 65 days, so a business can be profitable on paper and still be waiting six to nine weeks to see that profit in its bank account.
The regulator now measures this directly, and the gap is wider than stated terms suggest. The Payment Times Reporting Regulator covers large businesses paying small business suppliers, and its August 2026 update reports on the six months to 31 December 2025:
| All industries | Prior cycle | Latest cycle |
|---|---|---|
| Average agreed payment term | 29 days | 29 days |
| Average payment time | 27.4 days | 27.2 days |
| To pay 80% of invoices | 38 days | 37 days |
| To pay 95% of invoices | 62 days | 55 days |
| Paid on time, within terms | 66.7% | 68.5% |
| Paid more than 60 days out | 6.7% | 5.9% |
Read the last two rows together and the case for invoice finance makes itself. The agreed term averages 29 days, but reaching 95% of small business invoices takes 55 days. In the regulator’s own words, it takes almost double the average agreed payment term for the vast majority of invoices to be paid. And 31.5% still aren’t paid within terms at all. Invoice finance exists because that gap is structural, not because your customers are unusual.
To be fair, it’s improving. The time to clear 95% of invoices came down 6.3 days on the previous cycle and on-time payment rose 1.9 points. But a business invoicing on 30-day terms still has to fund the difference between what was agreed and when the money arrives, and that difference is currently around 26 days at the tail.
Payment Times Reporting Regulator, Regulator’s Update, August 2026, covering 1 July to 31 December 2025. The Regulator notes that measures introduced from 1 July 2024 are not directly comparable with cycles before the 2024 reforms.
That gap between recorded profit and available cash is the problem invoice finance is built for. It releases what you’ve already earned instead of waiting on customer payment terms. If your business is carrying a healthy debtor book but a thin cash buffer, that’s less a sign something’s wrong and more a sign it’s time to stop financing your customers’ payment terms out of your own pocket.
Source: a CommBank-commissioned YouGov survey of 507 Australian SME owners and decision-makers, reported by UNSW Sydney.
Why does invoice finance suit fast-growing businesses specifically?
Growth itself creates the cash flow problem invoice finance is built to solve. A business scaling quickly is issuing more invoices, on the same 30-to-90-day terms, and the gap between doing the work and getting paid for it widens right when the business needs cash most: to fund the next round of stock, staff or orders.
Without invoice finance in place, that gap often gets plugged with more expensive, less suitable debt taken on in a hurry: an unsecured loan or a merchant cash advance drawn under pressure, rather than a facility built for the shape of the problem. Structured early, invoice finance releases growth capital as it’s earned rather than forcing a business to borrow against something else to cover a gap its own invoices already fund.
What should you have in place before you start drawing on a facility?
Three things. Get them right before you apply and you’ll save yourself friction later.
First, clear payment terms with your customers, written down and consistent. A lender is assessing your ledger, and inconsistent or undocumented terms make it harder to fund. Second, most invoice finance providers run more than one product (working capital lines, trade finance, asset finance), so pick a lender with room to grow with you, or you’ll be restarting the relationship the moment your needs change. Third, check what admin the facility creates. Some lenders integrate directly with Xero, MYOB and similar software, and some even offer virtual CFO support. Others still run on manual invoice uploads. That’s a real, ongoing time cost, and a comparison page rarely shows it.
Why can invoice finance limits be higher than an overdraft or line of credit?
Invoice finance is assessed against your debtor ledger, not your bank statements or financials. That’s why the limit can run well past what an overdraft or line of credit would offer the same business. An overdraft or line of credit has to be justified by serviceability: what your bank statements show the business can support. An invoice finance limit tracks what your customers owe you. A business with a large, collectable ledger can access considerably more through invoice finance than through a cash-flow product sized against its own financials.
What’s the difference between invoice factoring and invoice discounting?
Both are forms of debtor finance, which is the umbrella term you’ll see used for either facility. Factoring is disclosed. The lender takes over collecting payment from your customers directly, and they’ll know a financier is involved. Discounting keeps you in control of your own ledger and customer relationships. Your customers keep paying you as normal, and the arrangement can stay confidential. Selective invoice finance is a third variant. You choose which individual invoices to fund rather than financing your whole sales ledger.
Which structure fits depends on your business, not a fixed rule. Some owners are comfortable with disclosure. Others need it kept confidential. We match that preference to a lender before applying, rather than defaulting to whatever one provider happens to offer.
Is invoice finance secured or unsecured?
The invoices themselves are the primary security, which is why property backing usually isn’t required the way it can be for a term loan or line of credit. That said, the usual rule holds: the cheaper the rate, the more a lender wants in return. Usually that’s a director’s guarantee, sometimes a general security agreement over business assets.
| Facility limit | $50,000-$100,000,000, higher available for the right business |
| Advance rate | Typically 80% to 90% of invoice value upfront |
| Security | The invoices themselves; director’s guarantee or GSA more likely at cheaper rates |
| Confidentiality | Varies by lender and structure, disclosed (factoring) or confidential (discounting), not a fixed rule |
Cash against an invoice, often within a day or two of raising it.
Why work with a broker instead of comparing lenders yourself?
Because the details that matter rarely show up on a comparison page. Do your customers need to know? How much does the lender want by way of guarantees? Does the facility plug into your accounting software, or expect manual uploads? A broker matches those preferences to the right lender before you apply, not after you’re locked in. (More on how a business loan broker works.)
We also know which lenders will look at a business below a major bank’s turnover cut-off. More on that next.
Which banks offer invoice finance, and does that mean you should go to one directly?
CommBank, NAB and Westpac all offer invoice finance, but the major banks typically set it up for larger businesses: Westpac’s own eligibility criteria state a minimum annual turnover of $4M and funding limits starting from $1M. Non-bank lenders often have far less strict criteria than a major bank: Earlypay states plainly that a short trading history, ATO debt or less-than-perfect credit history “doesn’t need to stand between you and the finance you need”, with no minimum turnover published at all, and Moneytech’s own eligibility criteria focus on the quality of your invoices and customers, not a turnover threshold. If you’re under a major bank’s cut-off, the fit is usually with non-bank and specialist lenders, sized to your business rather than a minimum turnover.
Two things people get wrong about invoice finance
It’s not as labour-intensive as it used to be
The old image is someone photocopying invoices and sending them off to the financier by hand. With the right lender now, the facility reads your accounting software, and eligible invoices are funded as they’re raised.
Your customers don’t always need to know
Whether the facility is confidential or disclosed depends on the lender and structure you choose, not a rule of the product itself. If confidentiality matters to you, say so upfront. It changes which lenders fit. It matters more often than people expect: Andrew has worked with a number of transport businesses that had dealt with the same clients for years and didn’t want them knowing a financier was involved. More lenders now offer confidential facilities. Some run through a monitored account in your business’s name, and some don’t need you to change bank accounts at all, so to your customers it’s business as usual.
What does invoice finance cost?
It isn’t automatically more expensive than other finance, despite the reputation. Cost depends on the lender, your customers’ credit quality and how the facility is structured. Its real advantage over a term loan is flexibility: you draw when you need to, instead of committing to fixed repayments whether the cash is needed or not. Our invoice finance calculator lets you model the advance and fee against your own invoices.
Ecommerce Loans is a finance broker, not a lender. Rates and figures shown are indicative only and subject to individual lender assessment.
When is invoice finance not the right call?
If your business doesn’t invoice other businesses on payment terms (pure retail or cash-on-delivery sales, for example), there’s nothing here for a lender to advance against, and a different product will fit better. It’s also not the right call if your invoice volume is too low or too irregular for a lender to build a facility around, or if you need a fixed lump sum for a one-off purchase rather than an ongoing revolving facility. A term loan is usually the cleaner fit there.
If that’s your business, tell us early. It saves us both a facility that was never going to work.
Compare this against
Not sure invoice finance is the right shape?
Is the gap on the buying side, not the selling side?
Trade finance funds a stock or supplier purchase, rather than advancing against invoices you’ve already issued.
See Trade finance →Are the gaps smaller and more general than one unpaid invoice book?
An overdraft gives you a flexible limit without tying funding to specific debtors.
See Business overdrafts →Don’t want funding tied to your debtor ledger?
An unsecured loan is assessed on the business as a whole, not linked to which invoices are outstanding.
See Unsecured business loans →How do you get invoice finance?
Tell us the basics (your monthly invoice volume, whether confidentiality matters to you, and your ABN) and we take it to the panel without a formal application or a credit check at that stage. We flag the disclosure requirements and accounting-software fit on the shortlist before you apply, not after.
Want the numbers first? Try the invoice finance calculator →
Run a professional services business? See how finance fits your revenue pattern →
Run an ecommerce business? See how finance changes as you scale →
Run a transport or logistics business? See how finance bridges 30-90 day terms →
Run a wholesale or trade business? See how the facilities work together →
New to working with a broker? See how a business loan broker works →
Give us the basics below and we’ll call you within the hour, or at the time you choose, then come back with the two or three offers worth your time.