Invoice finance vs invoice discounting: are they different?
TL;DR: In Australia and New Zealand, 'invoice finance' and 'invoice discounting' often mean the same thing: funding against unpaid invoices, confidential to your customer. The label matters less than the structure. Traditional discounting locks you into the whole ledger with monthly fees and minimum volumes. FundTap's selective approach lets you fund any invoice you choose, with no minimums and no lock-ins.
These two terms create a lot of confusion. Here’s what they actually mean — and why for most small businesses, the distinction doesn’t matter as much as people think.
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The short answer
In New Zealand and Australia, “invoice finance” and “invoice discounting” are often used to mean the same thing: advancing money against unpaid invoices while keeping your customer relationships intact.
The distinction that matters is between confidential (customers don’t know) and disclosed (customers are notified). FundTap is confidential — your customers never find out.
| Feature | Invoice Finance | Invoice Discounting |
|---|
| What it means | General term for funding against invoices | Specific term for confidential invoice funding |
| Customer notification | Varies by provider | Customers don't know |
| Who collects payment? | Varies | You collect as normal |
| Minimum requirements | Varies by provider | Usually larger businesses |
| FundTap's approach | Confidential invoice finance | Matches invoice discounting definition |
What matters more than the label
- Is it confidential? (Your customers shouldn’t find out)
- Is it selective? (You should be able to fund specific invoices, not your whole ledger)
- Is there a lock-in? (You should be able to stop at any time)
- Is the fee transparent? (One flat fee is easy to understand)
FundTap ticks all four.
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