Invoice finance, arranged online

What problem does invoice finance solve?

You’ve done the work, delivered the goods, sent the invoice. Your customer is reliable — but their terms are 45 days, and your wages are due on Thursday. That gap between earning money and receiving it is one of the most common cash-flow problems for businesses that sell to other businesses.

Invoice finance closes that gap. Rather than waiting for your customer to pay, you receive a large share of the invoice value soon after issuing it. When the customer pays, the facility is settled and the remaining balance, less fees, comes back to you. business.gov.au includes invoice financing in its overview of debt funding options for exactly this reason.

Factoring or discounting — what’s the difference?

	Invoice discounting	Invoice factoring
Who collects from customers	You	Often the lender
Do customers know?	Usually not	Usually yes
Suits	Businesses with good collection processes	Businesses wanting collections handled
Control	You keep the customer relationship	Shared with the lender

Some facilities also let you finance selected invoices one at a time rather than your whole ledger. That’s useful if you only need help with a few large, slow-paying clients.

How does invoice finance work online?

The online version is noticeably faster than the old paper approach, mostly because of accounting software.

1. Enquire online with your average monthly invoicing and your main customer types. No credit check is involved at this stage.
2. Connect your accounting software — commonly Xero, MYOB or QuickBooks — so the lender can see your debtor ledger and invoice history.
3. Share bank statements through a secure link if the lender asks for them.
4. Verify identity online for directors.
5. E-sign the facility documents.
6. Draw against invoices through an online portal as you issue them.

If your invoicing lives in spreadsheets rather than software, it’s still possible, but expect to upload ageing reports and invoice copies. The Skip-the-Branch Checklist shows how your bookkeeping set-up changes what you need.

Who is invoice finance a good fit for?

• Labour hire and staffing businesses paying wages weekly but invoicing monthly.
• Wholesalers and manufacturers supplying retailers on trade terms.
• Transport and logistics operators with large corporate customers.
• Professional services and agencies with project or retainer invoices — see finance for digital agencies.
• Subcontractors to larger firms with predictable but slow payment cycles.

It’s less suitable if most of your sales are to consumers, if invoices are frequently disputed, or if your customers are themselves in financial difficulty.

What will the lender look at?

Unlike a standard loan, invoice finance pays close attention to your customers:

• how creditworthy your main debtors are;
• how concentrated your ledger is — one huge customer is riskier than ten medium ones;
• how long invoices actually take to be paid, compared with your stated terms;
• how often invoices are disputed or credited.

Your own business still matters — trading history, ATO position and existing debts are all considered — but strong customers can carry a younger business further than you might expect. If you’d like an honest view of your ledger, send us a quick enquiry.

Illustrative example: a labour-hire business growing too fast

Illustrative only. A labour-hire business has just won a contract with a large construction company on 60-day terms. Wages for the extra workers are due weekly. Growth is good news, but it’s draining the account.

The owner enquires online, connects her accounting software and verifies her identity. An invoice discounting facility is set up against her debtor ledger. Each week, after invoices go out, she draws funds through the portal to cover payroll. When the builder pays, the facility clears automatically.

How much does invoice finance cost?

Costs usually come from two places: a discount or service charge on the funds you draw, and administration fees for running the facility. Some facilities also charge for each invoice processed. Because pricing depends on your ledger, your customers and how much you use the facility, we don’t publish rates. Your specialist will set out every cost in plain terms before you sign anything, so you can compare it with the cost of waiting — lost discounts from suppliers, work you can’t take on, or late fees on your own bills.

What happens if a customer doesn’t pay?

That depends on whether the facility is “recourse” or “non-recourse”. With recourse facilities, which are common for smaller businesses, you remain responsible if a customer fails to pay, and the lender will recover the advance from you. Non-recourse facilities shift some of that risk to the lender, usually at a higher cost and with stricter conditions on which customers qualify. Knowing which one you have is part of reading the documents carefully before you e-sign.

Invoice finance alongside other options

Invoice finance isn’t the only way to handle slow payers. A business line of credit can cover general timing gaps, and tightening your own terms helps too. business.gov.au suggests practical measures such as invoicing promptly, offering easy payment methods and following up overdue accounts. The best results often come from combining better collections with the right facility.

Turn finished work into cash sooner

If unpaid invoices are the reason your account runs tight, invoice finance might be the cleanest fix. The online enquiry takes about a minute and won’t touch your credit file. It lands with one team who look at your ledger and your business — your details aren’t shopped around to a list of lenders.

Please tell us your typical monthly invoicing, your customers’ payment terms and how you keep your books. Accurate answers mean a properly matched facility from the start. See if invoice finance suits your business.