Invoice Finance Fee Comparison Model

A free working spreadsheet for comparing invoice finance quotes. Enter up to three quotes and 12 months of your own invoicing, and it works out the service charge, the months where a minimum fee tops it up, the discount charge at base rate plus margin, other fees, year 1 total cost and the cost per £100 of funding actually in use. On the worked example below, the quote with the lowest headline service charge pays its minimum fee every month, and the quote that is cheapest in cash is the dearest per pound of funding. No email needed to download.

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The same model runs below. It starts with the worked example; overwrite any figure and the results update. Nothing you type leaves your browser.

Worked example

A business invoicing £590,000 a year, with a quiet spell in months 5 to 7 and customers paying in 45 days on average, has three quotes. Base rate is 3.75%, the Bank of England Bank Rate in effect since 18 December 2025 (source). The quotes are illustrative.

### Worked example: the three illustrative quotes

| Line | Example quote A | Example quote B | Example quote C |
| --- | --- | --- | --- |
| Facility type | Confidential invoice discounting | Factoring (recourse) | Selective (spot) invoice finance |
| Share of invoicing through the facility | 100% | 100% | 30% |
| Service charge (% of invoices funded) | 0.5% | 1.2% | 1.5% |
| Discount margin over base rate | 2 points | 2.5 points | 3 points |
| Advance rate | 85% | 90% | 90% |
| Minimum monthly fee | £350 | £250 | £0 |
| Setup fee | £1,500 | £750 | £0 |
| Other monthly fees | £100 | £0 | £0 |
| Other annual fees | £0 | £750 | £0 |
| Bad debt protection | 0% | 0% | 0% |
| Minimum term | 12 months | 12 months | 0 months |
| Notice period | 3 months | 1 months | 0 months |

Illustrative figures chosen to show how the model behaves. Not any provider's pricing.

### Worked example results over 12 months of invoicing totalling £590,000

| Result | Example quote A | Example quote B | Example quote C |
| --- | --- | --- | --- |
| Service charge | £2,950 | £7,080 | £2,655 |
| Minimum fee top-ups | £1,250 | £0 | £0 |
| Months the minimum applied | 12 of 12 | 0 of 12 | 0 of 12 |
| Discount charge | £3,605 | £4,148 | £1,344 |
| Bad debt protection | £0 | £0 | £0 |
| Other fees | £1,200 | £750 | £0 |
| Setup fee | £1,500 | £750 | £0 |
| Year 1 total cost | £10,505 | £12,728 | £3,999 |
| Average funds in use | £62,688 | £66,375 | £19,913 |
| Year 1 cost per £100 of funds in use | £16.76 | £19.18 | £20.08 |
| Committed cost over minimum term | £10,505 | £12,728 | £0 |
| Cost of running the notice period | £2,251 | £998 | £0 |

Source: Market Invoice fee comparison model

Computed by the model on this page from the inputs above, with base rate 3.75% and 45 debtor days. Figures rounded to the nearest pound.

What the example shows

• The headline service charge is not what you pay. Example quote A leads with a 0.5% service charge, but its £350 monthly minimum is higher than 0.5% of any month's invoicing in the example, so the minimum applies in 12 of 12 months. Its real service cost works out at 0.71% of invoicing, not 0.5%. Here it still comes in below Example quote B (£10,505 against £12,728 in year 1), but with lower invoicing the minimum would take a bigger bite.
• Cash cost and cost of funding point different ways. Example quote C costs £3,999 in year 1, the least in cash, but it only funds 30% of invoices, so average funds in use are £19,913 against £62,688 for Example quote A. Per £100 of funding it is the dearest at £20.08.
• The notice period is a cost too. Giving notice on Example quote A still leaves 3 months of charges to run, about £2,251 at the example's average monthly running cost, against £998 on Example quote B's 1-month notice.

How each line is calculated

Every figure in the workbook is a visible formula on the Workings sheet, so you can check it. The method matches our lifetime cost calculator.

• Invoices funded = month's invoicing x share put through the facility (100% for whole-turnover factoring or discounting).
• Service charge = invoices funded x service charge %.
• Minimum fee top-up = minimum monthly fee minus that month's service charge, when the service charge falls short.
• Funds in use = invoices funded x advance rate x (debtor days / 30), the average amount drawn and outstanding.
• Discount charge = funds in use x (base rate + margin) / 12.
• Year 1 total = all of the above plus bad debt protection, other fees and the setup fee.
• Cost per £100 of funds in use = year 1 total / average funds in use x 100.
• Committed cost over minimum term = monthly running cost x minimum term + setup fee.

What it does not cover

The model uses one debtor-days figure for the year, so if some customers pay far slower in some months, your discount charge will run higher than shown. It does not add VAT, and it does not price early termination fees, which differ widely between agreements; the exit cost calculator handles those. For a single quiet month, the minimum fee shortfall calculator is quicker, and to price one batch of invoices on a selective quote, including any the funder rejects, use the selective batch cost model.

To fill in real figures, work from the facility letter rather than a sales summary. Our line-by-line comparison guide explains where each figure sits in a typical quote, and the UK Invoice Finance Rate Index shows the service charge ranges providers publish, if you want a sense check.