Best Debtor Finance Brokers - Compare 80+ Lenders
Compare offers from over 80 lenders to find the right debtor finance for your business. Get a fast decision and access funds in as little as 24 hours.
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Fill out a quick questionnaire so our LendIQ™ system can scan 80+ providers. This initial step is free and has no impact on your credit record.
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Select your best match. Our experts help you structure the facility, whether through an invoice factoring arrangement or a confidential facility, to suit your workflow.
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Confirm your details. Once the facility is live, simply upload your invoices and get up to 95% of their value, often within 24 hours.
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"Business owners often see Debtor Finance as just another loan, but that’s the wrong way to look at it. It's a strategic tool that turns your slowest-paying customers into your fastest source of cash, fundamentally changing how you manage your growth."
Andrew Beckett, Head of Broker and Third Party Distribution
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Your Guide to Debtor Finance in Australia
While traditional institutions often reject small business finance applications due to rigid requirements, the receivables finance market operates differently. It focuses on your sales performance rather than your real estate. This guide explains how to unlock the working capital tied up in your unpaid invoices. This is a common form of debtor funding.
Updated: 11/02/2026
Debtor Finance By The Numbers
The SME finance market is vast, but understanding the key figures for this solution helps you identify a competitive offer. When you compare specialist non-bank providers against traditional banking products, the difference in accessibility is clear.
$165,298
Average Approved Facility Size
77%
Adoption by Growth-Oriented SME
80%
Typical Upfront Cash Advance
27 DAYS
Average Time Application to Facility Activation
<48 HOURS
Availability of Funds Post-Approval
Eligibility Criteria for Debtor Finance
While requirements vary between lenders, this type of finance is generally more accessible than unsecured term loans. To qualify, most lenders will look for the following:
- Business Type: You must sell goods or services to other companies (your finance debtor) on credit terms (B2B invoicing). Receivables to the general public are generally not accepted.
- Trading History: Most providers prefer a trading history of at least 6 months to demonstrate a consistent cycle of invoicing.
- Annual Turnover: While solutions exist for startups, established facilities usually require a minimum projected turnover, such as $200,000 per annum.
- Credit Terms: Your invoices should have standard credit terms, for example, 30 to 60 days. Invoices with extremely long terms can be harder to fund.
How Debtor Finance Works
Unlike a term loan where you receive a static lump sum that you must repay regardless of your revenue, this type of financing is a dynamic revolving facility. It scales up and down automatically with your sales volume to provide flexible working capital.
Here are the standard mechanics of how these facilities operate in Australia:
- Upfront Capital Access: You submit your sales invoice to the provider and receive a percentage, typically 80%, immediately.
- Revolving Limit: As you raise more sales invoices, your available limit increases automatically. This removes the need to reapply for capital every time you win a new contract.
- Asset Security : The provider takes security over the receivables. This acts as a smart alternative to securing finance against property.
- Tax Efficiency: Interest and service fees associated with this type of finance are generally tax-deductible expenses.
- Confidentiality: The first question I always get is, 'Will my customers know?' For over 90% of our clients, the answer is no. A confidential facility operates invisibly in the background. You get paid in 24 hours, and your customer relationship remains exactly the same.
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Choosing the Right Finance or Discounting Structure
1. Confidential Invoice Finance
Also known as confidential debtor discounting, you retain full control of your debtor ledger and client relationships. The provider provides the capital against the receivables, but you continue to chase your own payments.
2. Disclosed Arrangements (Factoring)
This solution is for companies that want to outsource their administration. In a disclosed arrangement, the provider supplies the capital and also takes over the management of the sales ledger, chasing outstanding invoices on your behalf.
3. Selective Finance
This structure allows for maximum flexibility. Instead of funding the whole sales ledger, selective finance allows you to choose specific invoices to fund as needed. This acts as a spot solution for occasional cash gaps.
Strategies to Secure the Best Debtor Finance Rates
- Maintain a Clean Ledger: Providers review your aged receivables report. A history of customers paying within 90 days with few bad debts significantly reduces the risk.
- Manage Concentration Risk: Financiers are wary of concentration risk, which occurs when you rely on a single client for the majority of your revenue.
- Compare The Whole Market: Different financiers specialise in different industries. Some favour construction while others prefer transport. Using a specialist can help with this process.
Factors Influencing Your Debtor Finance Rate
When a provider offers a rate, it reflects the perceived risk of your debtors. The payment history of the companies paying you is often more important than your own financial record. Invoices to government bodies or blue-chip firms attract the lowest rates.
Main Fees Attached to Debtor Finance
These finance costs are structured differently from standard business loans. You will typically see a two-part fee structure:
- The Service Fee: An administration charge applied to the face value of every invoice you fund (typically 0.5% to 2.5%).
- The Discount Rate: The interest charged on the actual funds you draw down, calculated daily.
Common Debtor Finance Questions
It's a health check of your sales ledger, showing who owes you money and how overdue they are. Lenders look for a "green flag" of invoices being consistently paid within terms (e.g., 0-90 days) and avoid the "red flag" of a large overdue column.
Yes. This type of finance assesses the strength of your customers, so providers can often supply capital even if a business director has minor credit history issues.
No. Modern invoice finance solutions integrate seamlessly with your existing bank accounts without requiring you to switch.
While the average time to set up a facility is 27 days, once it is active, capital is typically available within 24 hours of uploading an invoice.
It acts as a revolving facility. As you issue more invoices, your limit grows, and as customers pay, your limit refreshes. Unlike a term loan, you don't need to reapply for a "top-up" as you grow.
How to Apply for Debtor Finance
1. Prepare Your Documents
Before applying, prepare a full application including ATO Statements (to prove tax compliance) and your Aged Payables/Receivables reports from your accounting software. This report serves as your primary asset document.
2. Lender Assessment
The lender will perform a "Full Doc" verification. This includes reviewing your ledger for concentration risk or overdue debts. Crucially, you must provide the contract for the specific debtor you wish to fund. This is a key step to prevent fraud.
3. Structuring The Facility
Based on the assessment, the lender will propose a structure and an advance rate. The advance rate is the percentage of the receivable they are willing to fund. This is the stage where you review the Letter of Offer.
4. Integration And Funding
Once the lender verifies the contract exists and the work is done, they approve the facility. Your accounting software is linked to the lender's system, and they release the funds, often within 24 hours for the first and subsequent invoices.
Finance Calculators
Is Debtor Finance Right for Your Business?
Debtor finance is a powerful tool for cash flow acceleration, but it is not suitable for every business model. Weighing the advantages against the limitations will help you make an informed decision.
Feature | Pros | Cons |
|---|---|---|
Cash Flow | Immediate access to capital, up to 95% of invoice value. | Immediate access to capital, up to 95% of invoice value. |
Security | No property security required. | Providers take security over the business assets (GSA) or just the invoices. |
Flexibility | Scales automatically as your turnover grows. | Requires B2B invoicing. Not available for B2C retail sales. |
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More Questions About Debtor Finance
It comes down to "Who takes the hit?" if a customer doesn't pay. Recourse (Your Risk): If your customer defaults, you are responsible for repaying the funds. Non-Recourse (Lender's Risk): If your customer goes bust, the lender absorbs the loss. You pay higher fees for this "insurance."
We are a marketplace, not a direct financier. Our role is to sit on your side of the table and have financiers compete for your business. We are paid the same commission regardless of which provider you choose, ensuring our advice remains unbiased.
With a recourse facility, the provider will eventually "recourse" the debt back to you, meaning you must repay the advance. With non-recourse, the provider may absorb the loss, provided the dispute is regarding insolvency, not workmanship.
Not necessarily. While some major banks require $5M+ turnover, we have specialist providers who work with startups and businesses with turnover as low as $200k per annum.
Generally, yes. Because the fees and interest are a cost of doing business, they are typically tax-deductible. We recommend speaking to your accountant for specific advice.
Yes, this is called Selective Invoice Finance. It allows you to fund specific invoices rather than your whole ledger. It is great for flexibility, but usually has a higher rate than a full-turnover facility.
Yes, but it requires a specialist provider. Many standard factors avoid construction due to contractual disputes, but we have a panel of providers who specialise in construction finance.
Getting a comparison through our system does not impact your credit score. An enquiry is only recorded once you proceed to a formal application with a specific provider.
After Approval: Managing Your Debtor Finance Facility
Once your facility is live, managing the capital becomes a routine part of your weekly ledger management process. The most common mistake businesses make is poor capital discipline. Ensure funds are used for strategic, high-ROI activities, not just spent quickly.
- Documentation: You generate and send invoices to your customers as normal.
- Upload: You upload these invoices to the provider's platform, which is often automated via software integration.
- Drawdown: The provider makes the agreed percentage of funds available for you to draw down immediately.
- Settlement: When your customer pays the outstanding invoice, the remittance goes to a collection account. The provider takes their fees and the original advance. The remaining balance is then remitted to you.
Andrew is a leading expert in commercial finance distribution. He specialises in connecting Australian SMEs with the right capital solutions. With extensive experience in the broker channel, he ensures businesses access the most effective funding structures available.
Andrew Beckett, Head of Broker and Third Party Distribution
As COO of Lend, Phil oversees the operational excellence of the platform. He ensures that the proprietary LendIQ™ technology delivers accurate, high-speed outcomes and maintains the highest standards of data integrity and user experience.
Phil Druce, Chief Operations Officer
Stories From Businesses We've Helped
Strategic Growth to Secure Major Contracts
Sarah's cleaning company won two large contracts but couldn't fund the upfront hiring and equipment costs due to 45-60 day payment terms. Using a $250,000 Debtor Finance facility, she accessed 80% of her invoices within 24 hours. This immediate cash flow allowed her to hire eight staff, purchase equipment, and service both contracts simultaneously. The result was a 60% revenue increase in just six months, a scale-up that would have been impossible otherwise.
Overcoming Bank Rejection Due to Customer Concentration
Mark's food manufacturing business was denied a bank loan for expansion because over 70% of his revenue came from a single supermarket client. We saw this customer concentration as a strength, not a risk. A $400,000 Debtor Finance facility was structured against these high-quality invoices. This allowed Mark to access up to 85% of their value, increase production by 40%, and secure a second major supermarket chain as a customer.
Urgent Funding to Secure a Time-Sensitive Project
James, an electrical contractor, won a major contract but needed $80,000 upfront for materials within five days to avoid project penalties. His bank couldn't act fast enough. We activated a $95,000 Debtor Finance facility, funding his first progress claim the same day. This allowed James to pay his supplier immediately, secure the materials, and start the project on schedule, saving the contract from falling through.
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