🎉 Savan Dhamaka Offer — Personal Loan BT starting 9.99%* for loans above ₹15L Learn more ›
MahadevX BT Advantage — Transfer your existing loan & save more · PL 9.99%* · Home 7.10%* · LAP 7.60%* · Business 7.10%* Learn more ›
₹1000+ Cr disbursed across India · Trusted by 5000+ borrowers · 25+ banking partners
Updated August 2026

Invoice Financing - Advance 70%-90% on Unpaid Invoices in 24-72 Hours

Convert your B2B receivables into instant working capital. Upload invoice, get 70%-90% funded within 3 days, buyer pays lender on due date. Rates from 12% p.a. Perfect for growing businesses with strong B2B buyers.

70%-90%Advance Rate
24-72 hrsFunding Time
12%+Interest
Nil CollateralRequired
Check Eligibility Talk to Expert

Get Best Invoice Financing Offer

Fill 4 fields. Expert calls in 30 minutes.

By submitting, you agree to be contacted by our team. We never share your data.
What is Invoice Financing

Invoice Financing Explained

Invoice Financing (also called Invoice Discounting or Receivables Financing) is a working capital solution where a lender advances 70%-90% of the value of your unpaid B2B invoices immediately, and collects the balance from your buyer on the due date. It converts your accounts receivable into instant cash without waiting the 30-90 days B2B buyers typically take to pay.

The Indian invoice financing market has expanded dramatically since RBI launched TReDS (Trade Receivables Discounting System) in 2018 to enable MSMEs to auction their invoices to multiple financiers competitively. Alongside TReDS, private fintech platforms like KredX, C2FO, Cashinvoice, and traditional banks now offer invoice financing across buyer types - from listed multinationals to mid-market corporates to PSU government buyers.

The core advantage over traditional working capital: eligibility depends more on your buyer\'s creditworthiness than yours. A 2-year-old MSME selling to Reliance Industries or TCS can access invoice financing at rates similar to what those large corporates would themselves borrow at - because the lender is essentially taking corporate risk, not MSME risk.

Key Features

Why Choose Invoice Financing

Fast Funding (24-72 hrs)

Once onboarded, each invoice is funded within 3 days. Fintech platforms as fast as same-day.

No Collateral

The invoice itself is the security. No property, machinery, or FD pledged.

Scales With Sales

The more B2B invoices you raise, the more working capital you access. No fixed limit.

Buyer-Based Underwriting

Approval depends on your buyer\'s creditworthiness, not just yours. Great for growing MSMEs.

100% Digital

Upload invoices via portal / API. No branch visits. Real-time status tracking.

Pay Only Per Invoice

No fixed limit fees. Interest and processing charged only on invoices you actually finance.

TReDS Preferential Rates

MSMEs auction invoices on RBI-regulated TReDS platforms and get rates as low as 8%-10%.

Improves Cash Flow

Break the buy-produce-sell-wait cycle. Take bigger orders. Pay suppliers early for discounts.

Eligibility

Invoice Financing Eligibility

Business Vintage

1-2 years for banks. 12 months for most NBFCs / fintech. Startups accepted if buyer is prime corporate.

Annual Turnover

Rs 40 lakh+ for bank platforms. Rs 20 lakh+ for fintech NBFCs. No upper limit.

Business Model

Must be B2B with recurring buyers. B2C invoice financing not typically available.

GST Registration

Mandatory. GSTR-1 filings serve as primary evidence of genuine invoices.

CIBIL Score

700+ preferred. 650+ acceptable if buyer is prime. TReDS accepts even lower if PSU/listed buyer.

Buyer Profile

Buyer must be verifiable: listed company, PSU, government, mid-cap corporate, or large private co.

Documents

Documents Required

One-Time Onboarding
PAN + Aadhaar of proprietor/directors. Business PAN. Udyam Registration. GST Registration Certificate. Constitution documents (partnership deed / MOA / AOA). Board Resolution (for companies). Address proof of business.
Financial Documents
2 years ITR with computation. Audited financials (P&L + Balance Sheet). 12 months primary current-account bank statements. 12 months GSTR-1 + GSTR-3B filings.
Buyer Verification
List of top 5-10 B2B buyers with monthly billing volume. Buyer PAN + GSTIN. Past 6 months sample invoices to each buyer. Buyer confirmation letter (some lenders). Past payment history (bank statements showing buyer payments).
Per Invoice Submission
The invoice PDF/copy. Purchase order from buyer (if available). Delivery challan / proof of goods dispatch. E-way bill (for physical goods). GST filing confirmation for the invoice period.
Top Lenders

Best Invoice Financing Platforms in India

RXIL (TReDS)
RBI-regulated TReDS platform - MSMEs auction invoices to multiple financiers competitively. Best rates for CPSE / PSU / listed corporate buyers.
Rate8.00% - 12.00%
AdvanceUp to 90%
M1xchange (TReDS)
Second-largest TReDS platform. Strong corporate onboarding. Good for MSMEs with mid-cap corporate buyers.
Rate8.50% - 13.00%
AdvanceUp to 90%
KredX
India\'s largest B2B invoice discounting platform. Fast onboarding. Wide investor base including HNIs and institutions.
Rate14.00% - 20.00%
Advance70%-85%
Bajaj Finance
NBFC invoice financing with GST + banking integration. Well-suited for established MSMEs with recurring buyers.
Rate14.00% - 22.00%
Advance70%-85%
HDFC Bank
Bank invoice financing with dedicated MSME desk. Best for existing HDFC current-account customers.
Rate10.75% - 15.00%
Advance75%-85%
C2FO
Dynamic discounting platform - buyer-initiated early payment. Preferred by large corporates offering vendor finance.
Rate9.00% - 15.00%
AdvanceUp to 95%
Interest Rates

Invoice Financing Rates (August 2026)

Platform TypeInterest Rate (p.a.)Processing FeeBest For
TReDS (CPSE / PSU buyers)8.00% - 10.00%0.25% - 0.50%MSMEs with govt buyers
TReDS (Listed / Prime corporate)9.00% - 12.00%0.50% - 0.75%MSMEs with large buyers
Bank Invoice Financing10.75% - 15.00%0.75% - 1.50%Existing bank customers
NBFC Invoice Financing14.00% - 22.00%1.00% - 2.00%Fast processing needed
Fintech Platforms (KredX etc)14.00% - 20.00%1.00% - 1.50%Wide buyer acceptance
Dynamic Discounting (C2FO)9.00% - 15.00%Nil / bundledBuyer-initiated programs
Application Process

How Invoice Financing Works

1

Platform Onboarding

KYC + financials + buyer list submitted. 3-7 days.

2

Buyer Verification

Lender verifies your top buyers. One-time.

3

Raise Invoice

You invoice buyer as normal. Upload copy to platform.

4

Advance Received

70%-90% of invoice funded within 24-72 hrs.

5

Buyer Pays

On due date, buyer pays lender directly.

6

Balance Released

Remaining 10%-30% released to you minus fees.

Pros & Cons

Is Invoice Financing Right for You?

Advantages

  • Fast funding - 24-72 hours per invoice
  • No fixed collateral needed
  • Scales automatically with your sales
  • Underwriting based on buyer, not just you
  • Great for startups with prime buyers
  • TReDS rates as low as 8% for PSU buyers
  • 100% digital process
  • Tax-deductible interest

Trade-offs

  • Only for B2B (not B2C invoices)
  • Rates higher than pure secured WC
  • With Recourse - you bear buyer default risk
  • Buyer must be verifiable + creditworthy
  • Per-invoice fees add up over time
  • Some buyers refuse to acknowledge assignment
Comparison

Invoice Financing vs Cash Credit vs Bill Discounting

FeatureInvoice FinancingCash Credit (CC)Bill Discounting
Basis of FundingIndividual unpaid invoiceInventory + all receivablesAccepted Bill of Exchange + LC
Buyer AcceptanceNot requiredN/ARequired (formal acceptance)
Advance Rate70%-90% of invoiceDrawing power basedUp to 90% of bill
Interest Rate12%-22%9.15%-16%9%-14%
Tenure30-90 days per invoice12-month limit (renewable)60-180 days per bill
CollateralInvoice assignmentInventory + receivablesBill + LC backing
Best ForGrowing B2B businessesSteady MSMEs with stockEstablished relationships with LC
Speed24-72 hours per invoice10-20 days one-time3-7 days per bill
20 Questions

Invoice Financing - Frequently Asked Questions

What is Invoice Financing?
Invoice Financing (also called Invoice Discounting or Receivables Financing) is a working capital product where a lender advances 70%-90% of the value of your unpaid B2B invoices immediately, and collects the balance from your buyer on the due date. It converts your accounts receivable into instant cash without waiting the 30-90 day credit period buyers typically take.
How does Invoice Financing work in India?
Step 1: You raise an invoice to your B2B buyer with credit terms (30/60/90 days). Step 2: Upload the invoice to your invoice financing lender via their portal. Step 3: Lender verifies the invoice + buyer creditworthiness, typically advances 70%-90% of the invoice value within 24-72 hours. Step 4: On the invoice due date, the buyer pays the lender directly (or you collect and remit). Step 5: Lender releases the balance (10%-30%) minus their fee.
What is the difference between Invoice Financing and Bill Discounting?
Invoice Financing: informal, no Bill of Exchange, does not require buyer acceptance, higher rates (12%-22%), faster process. Bill Discounting: formal under Negotiable Instruments Act, requires accepted Bill of Exchange from buyer, backed by LC, lower rates (9%-14%), stronger legal recourse. Invoice Financing is what most MSMEs actually use because it needs no buyer signature.
What is the interest rate on Invoice Financing?
Rates range 12%-22% per annum, calculated pro-rata for the days from advance to collection. So a 60-day invoice at 15% costs about 2.47% of invoice value in interest. Banks charge lower (12%-18%); NBFCs and fintech platforms charge 15%-22%. Rate depends on your buyer's creditworthiness more than yours.
What percentage of invoice value do I get advanced?
70%-90% depending on the lender, buyer profile, and invoice history. Prime buyers (listed companies, MNCs, government): 85%-90%. Mid-tier buyers: 75%-85%. New/small buyers: 70%-75%. First-time customer typically gets a lower advance rate that improves over 6-12 months of clean history.
What are the eligibility criteria for Invoice Financing?
Business vintage: minimum 1-2 years (some fintechs accept 12 months). Annual turnover: Rs 40 lakh+ for banks, Rs 20 lakh+ for NBFC/fintech. GST registration mandatory. Clean 12 months banking. B2B business model with recurring buyers. Individual invoice value typically Rs 50,000+ (some platforms accept Rs 25,000+).
Do I need to pledge collateral for Invoice Financing?
No - the invoice itself is the collateral (technically an assignment of receivables to the lender). You do not pledge property, machinery, or FD. However, some lenders require personal guarantee from promoters and post-dated cheques as security.
How much CIBIL score is needed for Invoice Financing?
700+ preferred but Invoice Financing is more lenient than pure unsecured loans - because the lender relies more on the buyer's creditworthiness than yours. 650+ is often acceptable if your buyer profile is strong. Some fintech platforms (KredX, C2FO, RXIL) approve at 600+ CIBIL if buyer is a prime corporate.
Which buyers can I raise invoices against for financing?
Any B2B buyer with an ITR/GST filing history the lender can verify. Best acceptance for: listed public companies, government departments/PSUs, MNCs, established mid-cap corporates. Weaker acceptance for: unlisted small companies, new startups, individuals (B2C invoices generally not accepted).
What is TReDS and how does it help MSMEs?
TReDS (Trade Receivables Discounting System) is an RBI-regulated electronic platform where MSMEs auction their receivables from corporates and PSUs to multiple financiers who bid competitively. Three platforms: RXIL, M1xchange, Invoicemart. TReDS gets MSMEs the lowest invoice financing rates (often 8%-10%) because of competitive bidding.
How long does Invoice Financing approval take?
Initial platform onboarding: 3-7 working days (KYC, financials, buyer verification). Each subsequent invoice: 24-72 hours from upload to funds in account. Fintech platforms (KredX, C2FO): 24 hours. Traditional NBFCs: 48-72 hours. Bank invoice financing: 3-5 days per invoice.
What documents are needed for Invoice Financing?
One-time onboarding: PAN, Aadhaar, GST cert, Udyam, 2 years ITR, 12 months bank statements, invoices for last 6 months, buyer list, incorporation documents. Per-invoice: the invoice copy, purchase order (if available), delivery challan/proof of dispatch, e-way bill.
Can I finance invoices to government buyers?
Yes, and government invoices are among the most favoured for Invoice Financing because of guaranteed payment (even if delayed). TReDS platforms have specific auction categories for CPSE and government buyer invoices. Rates are excellent (8%-12%). Only challenge: government payment cycles can extend to 120-180 days requiring longer financing terms.
What happens if my buyer does not pay the invoice?
Depends on whether it is With Recourse or Without Recourse financing. With Recourse (most common in India): you are liable for repayment even if buyer defaults. Without Recourse (rare, more expensive): lender absorbs the buyer default risk. Some fintech platforms offer credit insurance for a small extra fee to convert With Recourse to Without Recourse.
What are the fees on Invoice Financing beyond interest?
One-time onboarding fee: Rs 5,000-25,000 (waived by some fintechs). Per-invoice processing fee: 0.5%-1.5% of invoice value. Buyer verification fee: Rs 500-2,000 per new buyer. Late fee (if buyer delays beyond agreed): 2%-4% per month on overdue amount. Credit insurance (optional): 0.5%-1% of invoice value.
Which fintechs are best for Invoice Financing in India?
KredX - largest B2B invoice discounting platform. C2FO - buyer-initiated dynamic discounting. RXIL / M1xchange / Invoicemart - RBI-regulated TReDS platforms. Cashinvoice - MSME-focused. FlexiLoans - fintech NBFC. LendingKart - digital NBFC. Bank of Baroda BOB WCTL, SBI e-DFS, Axis Invoice Financing for bank routes.
Is Invoice Financing better than a Cash Credit limit?
Different use cases. CC gives you a fixed limit backed by inventory + full receivables - drawdown as needed but limit is capped. Invoice Financing scales with each individual invoice - if you raise Rs 10 crore of invoices this month, you can finance Rs 8 crore against them. Choose CC for steady operations, Invoice Financing for growth periods where receivables balloon.
Can startups use Invoice Financing?
Yes - Invoice Financing is one of the most startup-friendly products because eligibility is based more on your buyers than your business vintage. A 6-month-old startup selling to Reliance / TCS / a listed company can access invoice financing immediately, while pure business loans might reject them for lack of vintage.
Is Invoice Financing interest tax-deductible?
Yes - all interest and fees paid on invoice financing are fully deductible as business expense under Section 37(1) of the Income Tax Act. Keep invoice financing statements from your lender for CA filing.
How can MahadevX help with Invoice Financing?
MahadevX matches your buyer profile, invoice value range, and turnover to the best-fit invoice financing lender across our network - banks, NBFCs, TReDS platforms, and specialised fintech partners. We handle onboarding paperwork, buyer verification, and negotiate advance rates. Free for borrowers.
Related

Related Loan Types

Bill Discounting Cash Credit Working Capital Loan Supply Chain Finance Trade Finance MSME Loan
Want to see all business loan options?View Business Loan Pillar →

Ready to Apply for a Invoice Financing?

Fill 4 fields. Get a call in 30 minutes. Compare offers from 100+ lenders. Zero fee to you.

Check Eligibility Call +91 98710 01985
Apply for Invoice Financing - 24 Hr Quote →
Apply Now
WhatsApp Us Call Now
Install the MahadevX appFaster access, works offline.
Tap Share, then Add to Home Screen