What Is Invoice Finance in Australia? A Complete Guide

TL;DR: Invoice finance lets an Australian business draw the money tied up in unpaid invoices before the customer pays, an advance in hours instead of a 30–90 day wait. It is not a traditional loan: you are accessing money you have already earned, repaid automatically when your customer pays.

How invoice finance works in Australia

Invoice finance advances you most of an invoice's value now, and settles when your customer pays. You have done the work and sent the invoice; invoice finance closes the gap between sending it and being paid.

With FundTap the steps are:

1. Connect your accounting software (Xero, MYOB, or QuickBooks)
2. Select the invoices you want to fund
3. Receive an advance, FundTap funds in hours, and the median time to a first fund is 3 days from sign-up (FundTap data, 2026)
4. When your customer pays, the advance settles automatically

"Most business owners don't have a profit problem, they have a timing problem. The money is earned; it's just sitting in someone else's account. On-demand invoice finance hands that timing back to the owner, one invoice at a time."

Matt Peacey, Founder & CEO, FundTap

Types of invoice finance available in Australia

There are three models, and they differ mainly in control and commitment.

• Invoice factoring, you sell invoices to a factoring company that manages collections and notifies your customers. Usually requires whole-ledger assignment.
• Invoice discounting, you borrow against invoices but keep control of collections. Confidential, but typically needs high turnover and whole-ledger assignment.
• On-demand invoice finance, you choose individual invoices to fund when you need to. No whole-ledger requirement, no lock-in. FundTap operates this model.

What does invoice finance cost?

Cost depends on the model. As a guide:

• Traditional factoring: 1–5% per month + service fees + possible minimums
• Invoice discounting: service fee (0.1–0.5% of turnover) + interest on advances
• FundTap: a single transparent fee from 4% per invoice, no monthly fees, no minimums, no hidden charges

Who can use invoice finance?

Most Australian businesses that invoice other businesses (B2B) on credit terms can use it. The usual requirements:

• You invoice customers on credit terms (not cash on delivery)
• Your customers are creditworthy businesses or organisations
• You use accounting software (Xero, MYOB, or QuickBooks for FundTap)

FundTap has no minimum turnover, no minimum trading history, and needs no asset security. FundTap's selective model also keeps risk low, its loss rate sits at 0.71% (FundTap, BNZ presentation 2025).

Is invoice finance a loan?

It is not a traditional loan. You are not taking on new debt, you are accessing money your customers already owe you, repaid automatically when they pay. It does not sit on your balance sheet as borrowing and does not consume your lending capacity with the banks.

Industries that commonly use invoice finance

Invoice finance is used across construction and trades, recruitment and staffing, manufacturing, wholesale and distribution, logistics and transport, professional services, and healthcare, any sector where businesses invoice on terms and wait 30–90 days to be paid .

See how FundTap works → Rated 5★ on Google (117 reviews) and 4.9★ on the Xero App Marketplace (107 reviews). (ratings row, place within 200px of the CTA per visual-identity.md trust-signal rules)

Frequently asked questions

What is invoice finance and how does it work in Australia?

Is invoice finance a loan?

How much does invoice finance cost in Australia?

Do my customers find out I'm using invoice finance?

What do I need to qualify for invoice finance?

How fast can I get funded?