Cash is absolutely key when setting up or growing a recruitment business. Over the last 5-10 years, we have seen more and more recruitment businesses utilise invoice finance products to release money from their outstanding permanent placement invoices.
We have a number of different suppliers that offer this facility and although the up front percentage of funding can be different between lenders, some offer up to 100% of the permanent invoice value as soon as the candidate has started. Sometimes if agreed in your terms, lenders pay on acceptance or a retained or staged invoice.
Depending on the lender, the process may be slightly different however below shows a guideline of how it could work
1 – You place a candidate into a new role.
2 – Invoice gets raised on day one of the candidate starting.
3 – You get up to 100% finance from the provider.
4 – The money gets paid to the provider when due.
Permanent finance can also, if required have the option of bad debt protection; some lenders even include it in the cost.
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