Take the discount or borrow?

If the annualised discount cost is higher than your finance rate, short-term borrowing to pay on normal terms may be cheaper.

No — it's a free illustration. Your actual Creditcorp offer depends on an assessment of your company.

Early payment discount calculator — Calculators

How to use it

Enter your figures above — the result updates instantly and nothing leaves your browser. Results are illustrative, not a quote or credit decision.

How to interpret the result

The output annualises a discount that's actually only available over a short window, which is why the figure often looks larger than the headline discount itself. A modest-looking reduction offered for a handful of days earlier payment can, once stretched out over a full year, translate into a materially higher cost of finance than it first appears — that's the whole point of annualising it.

Use the result as a comparison yardstick rather than an answer in itself. If your company already has a facility in place, or knows roughly what its typical cost of borrowing looks like, the useful question is whether that rate sits above or below the annualised discount cost. Where the discount cost is the higher of the two, paying on standard terms and drawing on finance in the meantime is usually the cheaper route; where it's lower, taking the discount tends to make more sense.

Limitations and good practice

This is a simplified illustration and deliberately leaves out real-world frictions: arrangement costs on any alternative finance, the administrative effort of tracking early-payment terms across multiple suppliers or customers, and the effect on working capital if early payment is taken across a large volume of invoices at once. It also assumes the discount and timing terms stay fixed, which in practice can shift supplier by supplier.

Before acting on the result, a director of a UK limited company would typically check it against actual quotes for any finance being considered, confirm the true payment terms with the supplier or customer in writing, and consider the cash flow impact of paying earlier across the whole ledger rather than a single invoice. Where the numbers are close, the safer habit is to treat this calculator as a first filter and get a proper comparison — for example against a Credicorp Flex facility or a fixed-term option via late payment interest comparison — before committing either way.