Invoice Finance · UK limited companies

Invoice Finance Costs and Fees

Invoice-finance pricing can include a service fee, a discount charge on funds used and additional charges for credit protection, audits, minimum usage or termination.

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NBS Finance is a broker and introducer, not a lender. An enquiry does not guarantee an offer.

Decision check

Invoice-finance charges to compare

Component	Ask the provider
Service or administration fee	What services are included, how is the fee calculated, and is there a minimum?
Discount charge	What amount is charged, for how long, and what happens if customers pay later?
Other charges	Ask about arrangement, audit, credit-protection and any additional service charges.
Minimum usage	Check whether charges apply even when little funding is drawn.
Notice and termination	Check the notice period, exit charges and any overlap with an existing facility.

Compare the same usage, not two headline percentages

Ask each provider to illustrate charges using the same annual credit sales, average funds drawn and payment timing. Include minimum fees, additional charges, the service offered and costs of leaving an existing arrangement.

Illustration only, not NBS pricing: a 0.5% annual service fee on £4m of applicable sales is £20,000. A hypothetical 9% annual discount charge on £400,000 drawn throughout a full year is £36,000. The simplified total is £56,000 before minimums and other charges. Actual charging bases, daily balances, rate changes and terms can alter the result.

For an existing facility, compare usable headroom and operational fit as well as cost. Read our switching-provider guide if you are considering a move.

What if customers pay later or turnover falls?

Hypothetical assumptions, not market rates: a £100,000 balance at an assumed 9% annual charge for an extra 30 days adds about £740 using a 365-day basis. Actual daily balances, base-rate changes and charging conventions matter. Separately, if a month produces a calculated £400 service fee but the contract has an assumed £750 minimum, the service charge is £750. Check whether fees are subject to VAT and which minimums apply.

Test a quiet month, slower collections and leaving early alongside normal usage. Compare the same service, usable headroom and exit arrangements, rather than two headline rates.

Quick answer

When this may be worth discussing

Comparing like-for-like facility structures

Understanding ongoing and one-off charges

Testing cost against the cash-flow and credit-control benefit

Provider assessment

Information that helps produce a useful answer

Providers set their own rates, charges, fees, security and terms. Clear evidence helps distinguish a viable route from an unsuitable application.

Expected annual turnover through the facility
Average utilisation and debtor days
Minimum fees, notice period and exit costs

Important: Request a written illustration and compare the complete cost and obligations, not a single percentage. Use the same expected turnover, funds drawn and customer-payment timing when comparing proposals.

NBS Finance is a broker and introducer, not a lender. NBS does not charge the client a separate broker fee. Providers set costs and terms and may carry out business or director credit checks; ask which searches will be made before a full application. An enquiry does not guarantee an offer.

Questions about invoice-finance charges

What is the service fee calculated on?

Ask whether the basis is assigned turnover, invoices handled or another contractual measure, and which services and minimum charges are included.

Does slow payment increase the cost?

A discount charge can continue while funds remain drawn. Ageing limits can also remove availability, so model both extra cost and a possible repayment need.

What happens in a quiet month?

Minimum service or usage charges may remain payable even when sales or drawings fall. Use the proposed agreement to calculate this scenario.

What does leaving cost?

Request notice dates, termination charges, settlement, legal/security-release costs and any overlap with a replacement facility in writing.

The services included differ: compare factoring with collections support and invoice discounting, or use our side-by-side comparison. The provider sets the actual fees and terms; no standard rate is assumed here.

Tell us the outcome your business needs

Start with the amount, purpose and timing. Best estimates are fine.

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Put the fees alongside available cash

Headline charges do not show the whole facility. An existing facility review compares annual costs with eligibility, reserves, debtor limits and the cash your business can actually use.