Debtor finance
Debtor Finance is a financing product that allows you to maximise your cash flow, which is a key factor in the success of any business. Unlike traditional lending products, this form of lending enables you to access funds using the strength of your sales as leverage.
By borrowing against the outstanding value of your trade debtors you won’t miss out on business opportunities that you otherwise may have which can help you achieve your business goals and targets.
You might use this type of product if your business sells goods or services on credit terms and consequently has restricted liquidity, or if your business is expanding or if your business activity is affected by seasonal trends.
Cashflow finance provides businesses with quick access to working capital by leveraging unpaid invoices or trade agreements, ensuring smooth operations, improved cash flow, and support for growth. Common types of cashflow finance in Australia include:
Invoice Financing (Factoring or Discounting): Businesses can borrow against unpaid invoices, receiving a percentage upfront (e.g., 80%), with the remainder (minus fees) paid upon invoice settlement.
Trade Finance: Helps businesses pay suppliers upfront while allowing them to defer repayment until their goods are sold.
Line of Credit: A revolving credit facility allowing businesses to withdraw funds as needed up to an approved limit, only paying interest on the amount used.
Cashflow finance is often used by SMEs to maintain operational liquidity, support growth, or navigate temporary financial challenges without relying on traditional bank loans.