What Are Typical Invoice Finance Rates in the UK? (2026)
As of 18 December 2025 the Bank of England base rate is 3.75%, so a typical invoice finance discount charge runs at roughly 4.75% to 6.75% annualised (base rate plus a 1% to 3% margin). On top sits a service charge, for which the indicative market range is 0.5% to 3% of invoice value (as stated by UK broker ABC Finance; most lenders publish none and quote per facility). Your total bill depends on how much you draw and how long your customers take to pay. Skipton Business Finance and Close Brothers do not publish a rate either: both price each facility individually.
What this page covers
This page covers
Current UK invoice finance rates with provider-specific examples
Not covered here
Whether it's worth the cost (see /questions/will-invoice-finance-eat-my-margins/), full cost calculator (see /calculator/), provider comparison (see /compare/)
Rate Ranges by Business Size
| Annual Turnover | Service Charge | Discount Margin |
|---|---|---|
| Under £250k | 1.5-3% | Base + 2-3% |
| £250k-£1m | 1-2% | Base + 1.5-2.5% |
| £1m-£5m | 0.5-1.5% | Base + 1-2% |
| £5m+ | 0.3-0.8% | Base + 0.75-1.5% |
View as plain-text Markdown
### Rate ranges by business size | Annual Turnover | Service Charge | Discount Margin | | --- | --- | --- | | Under £250k | 1.5-3% | Base + 2-3% | | £250k-£1m | 1-2% | Base + 1.5-2.5% | | £1m-£5m | 0.5-1.5% | Base + 1-2% | | £5m+ | 0.3-0.8% | Base + 0.75-1.5% |
Use the Calculator
The two charges work on different bases: the service charge is a percentage of the invoices you put through, while the discount margin is an annual rate charged only on the money you have drawn and only for as long as it is outstanding, so they cannot simply be added together. A 1% service charge on £500k turnover costs £5,000/year. The same 1% on £2m turnover costs £20,000/year - but you are accessing far more funding. Use our invoice finance calculator to model costs based on your actual numbers.
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.
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