APR vs. Discount | C2FO Help Center
APR vs. Discount
Written by Lauren Bock
June 3, 2026
When setting a rate for Name Your Rate divisions, you can choose whether to submit your offer as an APR or a Discount. While both options express the cost of early payment, they use different math to calculate that cost.
Understanding the Rate Types
APR (Annual Percentage Rate): An annualized rate applied to each invoice based on its specific Days Paid Early (DPE).
How it works: Invoices paid only a few days early cost less than invoices paid many days early at the exact same APR. This is ideal for recurring, ongoing offers where invoice timing varies.
- Platform description: "Best value for recurring offers; calculates individual rates per invoice based on how early you are getting paid."
Discount: A fixed, flat percentage taken off the invoice face value, regardless of how many days early you are paid.
How it works: A 2% discount on a $10,000 invoice always costs $200. This is ideal for one-time offers when you prefer a simple, uniform, and easily predictable cost.
- Platform description: "A flat rate applied to each invoice in your offer."
Comparison Matrix
| Feature | APR | Discount |
| Based on | Days paid early (DPE) per invoice | Invoice face value |
| Cost per invoice | Varies depending on the due date | Same fixed percentage of the amount |
| Typical use | Recurring / ongoing offers | One-time or uniform costing |
| Estimated amount | Reflects a blended DPE across invoices | A straight percentage of the total |
Note: The review screen shows estimated amounts using whichever rate type you selected. You can toggle and compare both on the review step if you are unsure which fits your cash-flow planning better.
Switching Rate Types in Build Offer
On the rate step, use the Rate Type dropdown to switch between APR and Discount.
- Fixed Rate and Variable Rate Divisions: These divisions use rates set directly by the market, not your manual APR or Discount entry. The rate type selection applies exclusively to Name Your Rate divisions in a mixed offer.
Quick Tips
- Use APR when you accelerate invoices with a wide range of due dates and want the total cost to scale dynamically with timing.
- Use Discount when your team models internal early-pay costs in simple, straightforward "percent off invoice" terms.
- Align your selection with how your finance team models early-pay costs internally.