Compare finance types
Invoice finance vs Low-doc loan: which is right for your business?
The main difference between a invoice finance and a low-doc business loan is how they are secured and repaid: a invoice finance suits b2b businesses with reliable customers on long payment terms, while a low-doc business loan suits established businesses without up-to-date financials.
Invoice finance vs Low-doc loan at a glance
| Invoice finance | Low-doc business loan | |
|---|---|---|
| What it is | Invoice finance is funding advanced against eligible unpaid business invoices, typically 70–90% of the invoice value upfront with the balance (less fees) paid when your customer pays. It uses your receivables as security rather than property. | A low-doc business loan is finance assessed on bank statements, ABN history and credit record rather than full financial statements and tax returns. Low-doc does not mean no documents or automatic approval. |
| Amount | $20,000 – $5,000,000 | $5,000 – $250,000 |
| Term | 1–12 months | 3–36 months |
| Indicative rate | 8% – 18% p.a. | 12% – 32% p.a. |
| Rate type | Variable | Fixed or variable |
| Security | Secured by receivables | Unsecured (guarantee may apply) |
| Repayments | Settled when the customer pays each invoice | Daily, weekly or monthly |
| Typical speed | 24–48 hours per invoice once set up | 24–48 hours |
| Best for | B2B businesses with reliable customers on long payment terms | Established businesses without up-to-date financials |
| Consider the other if | Businesses that sell to consumers or are paid at the point of sale | Larger amounts where full-doc pricing is materially cheaper |
| Tax | Fees are generally a deductible business expense. | Interest on business-purpose borrowing is generally deductible. |
Rates shown are indicative ranges observed across our lender panel for the period stated. They are not an offer or quote. Your rate depends on your business, the lender, the amount, the term and the security offered. The lender makes the final credit decision.
When to choose a invoice finance
A invoice finance is usually the better fit for b2b businesses with reliable customers on long payment terms. Its main advantages are grows with your sales, no property security, can be confidential. Consider the alternative if businesses that sell to consumers or are paid at the point of sale.
When to choose a low-doc business loan
A low-doc business loan is usually the better fit for established businesses without up-to-date financials. Its main advantages are fewer documents, fast decisions. Consider the alternative if larger amounts where full-doc pricing is materially cheaper.
Invoice finance
Invoice finance is funding advanced against eligible unpaid business invoices, typically 70–90% of the invoice value upfront with the balance (less fees) paid when your customer pays. It uses your receivables as security rather than property.
Low-doc business loan
A low-doc business loan is finance assessed on bank statements, ABN history and credit record rather than full financial statements and tax returns. Low-doc does not mean no documents or automatic approval.