DSO Cash Release Calculator
Every day your customers take to pay is a day you fund their purchase. This calculator shows exactly how much working capital your business would release by reducing its Days Sales Outstanding — and how much interest you would save on your cost of funds each year.
Your debtor book
Total annual credit sales (revenue invoiced on terms).
Average days it currently takes to collect an invoice.
The rate you pay to fund working capital — used to value the cash released.
Why reducing DSO frees up cash
Every day a customer takes to pay is a day your business is funding their purchase. The money tied up in your debtor book is working capital you cannot spend. Cut your average collection period and that capital is released as cash — a one-off injection you can use to pay down your overdraft, fund stock, or invest in growth, without borrowing a cent.
The interest saving is recurring: once the cash is released, you stop paying your cost of funds on it year after year. Tightening collections is one of the cheapest forms of finance available to a business.
This is an indicative calculation only — not financial advice. Actual cash released depends on your collection performance, seasonality, and debtor mix. Seek professional advice for your specific circumstances.
What is Days Sales Outstanding?
Days Sales Outstanding (DSO), sometimes called debtor days, is the average time it takes your business to collect payment after making a credit sale. If your DSO is 55, your invoices are paid 55 days after they are raised, on average. It is one of the clearest measures of how efficiently you turn sales into cash. To work out your current figure from your balance sheet, use the Days Sales Outstanding Calculator.
Why cutting debtor days is free working capital
The money owed to you by customers is real capital — but you cannot spend it until it lands in your account. Every dollar sitting in your debtor book is a dollar you have effectively lent to your customers, often funded by your own overdraft. When you reduce your DSO, the gap between your current receivables and your target receivables is released as cash. That is a one-off injection of working capital you get without borrowing, raising equity, or paying a single dollar of arrangement fees.
The recurring interest saving
The cash release is one-off, but the saving keeps giving. Once that capital is back in your account, you stop paying your cost of funds — your overdraft or facility rate — on it, year after year. At a 9% cost of funds, releasing $60,000 of trapped cash saves roughly $5,400 every year indefinitely. Faster collections are one of the cheapest forms of finance a business can access, and the levers are entirely within your control: tighter credit terms, prompt invoicing, and disciplined follow-up on overdue accounts.
This is an indicative calculation only — not financial advice. The cash you actually release depends on your collection performance, seasonality, and debtor mix, and the interest saved depends on your real cost of funds. Seek professional advice for your specific circumstances.
Merion turns overdue invoices back into cash.
Commission-only recovery — no recovery, no fee. We pursue your slow-paying debtors so your working capital comes home faster.
Related tools
Cost of Late Payment Calculator
Find out what your overdue receivables ledger is really costing — in finance charges and staff time.
CalculatorNet Recovery Estimator
See exactly how much you keep after Merion's commission when a debt is recovered.
CalculatorRecovery ROI Calculator
Is it worth referring this debt? Compare the net benefit against doing nothing.
CalculatorCommission Estimator
Estimate Merion's likely commission rate and your net return based on debt age and face value.