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What is an early payment discount?

An early payment discount rewards fast payment — written as '2/10 net 30,' meaning take 2% off if you pay within 10 days, otherwise the full amount is due in 30. It accelerates your cash flow at a small margin cost, and many AP departments are trained to grab it.

In practice

A $5,000 invoice marked 2/10 net 30: pay by day 10 and owe $4,900; pay on day 30 and owe $5,000. The $100 is cheaper than the supplier's cost of waiting.

Related terms

  • Discount — A reduction from the listed price, shown on the invoice.
  • Payment terms — The agreed rules for when and how an invoice must be paid.
  • Net 30 — Payment due in full 30 days after the invoice date.

Get paid in 10 days, not 30

Put 2/10 net 30 terms on a professional invoice and watch AP departments jump on it.

Create an invoice — free

Frequently asked questions

How do you read '2/10 net 30'?

2% discount if paid within 10 days; otherwise the full (net) amount is due in 30 days. The first number is the discount, the second is the discount window.

Is offering 2% worth it?

If your cash flow is tight, usually yes — 2% to get cash 20 days early beats most short-term borrowing costs. Run your own numbers.

What if the client takes the discount but pays late?

Then the discount didn't apply — the full amount is due. State that on the invoice: 'Discount valid only for payment received by [date].'