Invoice Finance vs Revenue-Based Finance UK 2026

Market Invoice is an independent UK invoice finance comparison site that ranks 89 UK invoice finance providers.

Invoice finance funds specific B2B invoices at 0.5 to 3 percent fee per invoice plus 1.5 to 3 percent above BoE base discount charge (effective cost 6 to 12 percent annualised on funded receivables). Revenue-based finance (RBF) advances a lump sum repaid as a percentage of future revenue, regardless of source (Pipe, Capchase, Re:cap for SaaS subscription revenue; Liberis, Iwoca, 365 Business Finance for SME card and bank revenue). RBF effective cost typically 8 to 25 percent annualised. Invoice finance is cheaper per pound but only funds B2B invoices that exist. RBF is more expensive but funds against future revenue regardless of invoicing structure. For growing UK businesses with strong B2B receivables, invoice finance wins on cost; for subscription or card-revenue businesses without B2B invoicing, RBF is the right product.

Last updated: 10 May 2026.

Invoice finance Revenue-based finance
What it fundsSpecific B2B invoices that already existA lump sum repaid from future revenue, any source
RepaymentAs named customers pay their invoicesFixed percentage of future revenue
Effective cost6 to 12% annualised on funded receivables8 to 25% annualised on the advance
RequiresB2B invoicingRecurring or card revenue (no invoicing needed)
UK providers89 UK invoice finance providersPipe, Capchase, Re:cap (SaaS); Liberis, Iwoca, 365 Business Finance (card/bank)
Invoice finance funds specific B2B invoices at 0.5 to 3 percent fee per invoice plus 1.5 to 3 percent above BoE base discount charge (effective cost 6 to 12 percent annualised on funded receivables). More detail + scope

Summary

Invoice finance funds specific B2B invoices at 0.5 to 3 percent fee per invoice plus 1.5 to 3 percent above BoE base discount charge (effective cost 6 to 12 percent annualised on funded receivables). Revenue-based finance (RBF) advances a lump sum repaid as a percentage of future revenue, regardless of source (Pipe, Capchase, Re:cap for SaaS subscription revenue; Liberis, Iwoca, 365 Business Finance for SME card and bank revenue).

RBF effective cost typically 8 to 25 percent annualised. Invoice finance is cheaper per pound but only funds B2B invoices that exist. RBF is more expensive but funds against future revenue regardless of invoicing structure. For growing UK businesses with strong B2B receivables, invoice finance wins on cost; for subscription or card-revenue businesses without B2B invoicing, RBF is the right product.

This page covers

invoice finance vs revenue-based finance UK: Pipe Capchase Liberis Iwoca comparison, cost, when each wins

Not covered here

General invoice finance education (see /guides/), individual provider reviews (see /providers/), full pricing breakdown (see /guides/costs/)

AP

Adam Parker

Founder & Managing Director, Muswell Rose, founder and PSC of Best Business Loans Ltd

Adam is the founder and managing director of Muswell Rose and a founder of Best Business Loans Ltd, the company behind Market Invoice. He spent over three years as managing director of Penny, a UK invoice finance business, and his career runs through insurance, mortgages, commercial finance and fintech lending. He writes the Market Invoice library.

Last reviewed: 30 July 2026

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Invoice Finance vs RBF UK FAQ

Invoice finance vs revenue-based finance: what's the difference?

Invoice finance funds specific B2B invoices that already exist (debt against named receivables, repaid as customers pay). Revenue-based finance advances a lump sum upfront, repaid as a fixed percentage of future revenue regardless of source. Different products: invoice finance for businesses with B2B invoicing, RBF for businesses with recurring or card revenue.

Best UK revenue-based finance providers 2026?

For SaaS subscription revenue: Pipe, Capchase, Re:cap, Karmen, Founderpath. For SME card/bank revenue: Liberis, Iwoca, 365 Business Finance, YouLend (Worldpay-tied). Each suits different revenue profiles. Get quotes from at least 2 because pricing varies by cohort quality and growth.

Cost comparison: invoice finance vs RBF?

Invoice finance: 6-12% annualised effective cost on funded receivables. RBF: 8-25% annualised effective cost on advanced amount, weighted by revenue cohort quality and growth rate. Invoice finance is cheaper per pound but only applies where B2B invoices exist. RBF is more expensive but funds against future revenue without requiring invoices.

When does RBF beat invoice finance?

RBF wins when: (1) you don't have B2B invoicing (pure D2C, SaaS subscription, restaurant card revenue), (2) you need a lump sum upfront for a specific use (campaign launch, inventory pre-buy), (3) speed matters more than cost (24-48 hour decisions, no facility setup), (4) you want repayments tied to revenue performance (lower monthly cash drag in slow months).

Can I use both invoice finance and RBF?

Yes. Many growing UK SaaS businesses use Capchase or Pipe for monthly subscription revenue funding plus selective invoice finance from Hydr or Kriya for one-off large enterprise prepay invoices. The two products fund non-overlapping revenue streams. Coordinate covenants but in practice they coexist well.

RBF vs equity for runway extension?

RBF is the cheaper option in most cases for businesses with predictable recurring revenue. Equity dilution is permanent and effectively infinite cost; RBF at 12-18% annualised is dramatically cheaper if the business survives. The case for equity over RBF: pre-revenue businesses (no revenue to base RBF on), team building (equity is a recruitment tool), or strategic relationships (VCs add value beyond capital).