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ABL for recruitment agencies

Invoice finance and ABL for recruitment agencies

Agencies pay contractors and temps every week, but clients pay in 30 to 60 days. We arrange confidential invoice finance at 95% to 100% of approved contract invoices, and asset based lending from £2m to £120m for larger agencies, matched to your payroll cycle, for temporary, contract and permanent recruitment businesses.

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No credit search and no upfront fee.

of approved contract invoices
95% to 100%of approved contract invoices
of invoicing, matched to payroll
Within 24 hoursof invoicing, matched to payroll
ABL facility sizes
£2m to £120mABL facility sizes
upfront fee
£0upfront fee
What can be funded

Finance shaped around the recruitment model

A recruitment agency's main asset is its sales ledger. The right facility turns it into weekly payroll funding.

Contract and temp invoices

95% to 100% of each approved timesheet invoice, as soon as it is billed, so payroll is never waiting on clients.

Payroll and back office

Some lenders combine funding with payroll, billing and credit control services, useful for growing agencies.

Permanent placement fees

Perm invoices can often be funded too, at a lower advance rate, so the whole ledger works for you.

Growth and acquisitions

A facility that scales with your contractor numbers, plus acquisition debt of up to 5x EBITDA for buying another agency, with GBF running the debt process.

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What it is for

Pay your people on Friday, whatever your clients do

The faster an agency grows its contractor and temp numbers, the bigger the cash gap between weekly pay and monthly client payments. Invoice finance closes that gap: as you bill more, you can draw more, with funds within 24 hours of invoicing.

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  • Fund weekly or monthly contractor and temp payroll
  • Take on new clients and bigger contracts with confidence
  • Cover PAYE, VAT and holiday pay obligations
  • Move from factoring to confidential invoice discounting
  • Buy out a shareholder or acquire another agency
  • Replace a lender whose limits have not kept up
Worked example

How a facility might look

Approved contract and temp invoices £2.6m at 95%
£2.47m
Term loan alongside, 5 years, to buy a smaller agency
£1.0m
£3.47m total: a £2.47m revolving invoice facility and a £1m acquisition term loan

Illustrative example of an agency billing £2.2m a month. Actual advance rates depend on client quality, contract terms and the lender's checks.

Try your own figures

Use the calculator below with numbers from your balance sheet for an indicative range.

Go to the calculator
How it works

From first call to facility live

  1. 1Day 1

    Share your ledger

    Latest accounts, an aged debtor report, your top client list and how you run payroll.

  2. 21 to 3 days

    Indicative terms

    We go to the lenders that specialise in recruitment and compare advance rates, fees and services.

  3. 31 to 3 weeks

    Audit and set-up

    The lender reviews your ledger, contracts and timesheet process. We handle the switch from any existing provider.

  4. 42 to 4 weeks

    Funding live

    Bill, upload and draw, matched to your payroll run.

Calculator

What could your assets raise?

£

Up to 90% advanced, 95% to 100% in some sectors

£

Up to 90% of its liquidation value

£

Up to 85% of its liquidation value

£

Up to 80% of market value

Indicative facility
£3,775,000 to £4,680,000
From your debtor book alone
up to £2,700,000
Get an indicative facility

Illustrative only. Full ABL facilities start from £2m. Lenders apply advance rates to eligible assets after checks on debtor quality, concentration, stock type and independent valuations. It is not an offer of finance.

Why recruitment agencies use invoice finance

Recruitment is one of the most cash-hungry business models in the UK. Every new contractor adds a weekly payroll cost weeks before the client pays. Invoice finance releases 95% to 100% of each approved contract invoice as soon as it is raised, with funds within 24 hours, so growth is funded by the billing it creates.

For larger agencies, asset based lending turns the ledger into one revolving credit facility from £2m to £120m, priced from 2% over Bank Rate on the receivables line, on 3 to 5 year committed terms, and can include any owned office property at up to 80% of market value. Acquisitions are funded with a term loan alongside, at up to 5x EBITDA, and we advise on the transaction and run the debt process end to end.

Confidential or disclosed?

With confidential invoice discounting your clients pay you as usual and never know a lender is involved; you run your own credit control. Factoring includes the lender's credit control service, which suits younger agencies without a dedicated credit team. Most agencies move to confidential discounting as they grow.

What lenders look for

  • Clear contracts with clients and approved timesheets behind every invoice
  • A spread of clients, with limits on any one
  • Robust payroll and compliance for PAYE, IR35 and holiday pay
  • Clean, current sales ledger and credit control

Talk it through

Share your latest figures and we will come back with an indicative facility within two to three working days.

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FAQs

Common questions

How much of each invoice can be funded?

In recruitment, 95% to 100% of approved contract and temp invoices, higher than most sectors because the work is done and signed off before you bill. Permanent placement fees are funded at a lower rate.

Can you fund permanent placement fees?

Often, yes, at a lower advance rate than contract invoices, because perm fees can be subject to rebates if a candidate leaves early.

How fast is the money available after we invoice?

Usually within 24 hours of uploading approved invoices, so funding can be timed to your payroll run.

We are a young agency. Can we still get a facility?

Yes. Several lenders specialise in start-up and early-stage agencies, usually with factoring and credit control included. You can move to confidential discounting as the ledger grows.

Can we switch from our current invoice finance provider?

Yes. The new lender settles your existing facility, and we manage the notice period and handover so payroll is not disrupted.

Can you fund buying another agency or a shareholder buyout?

Yes. We advise on acquisitions, MBOs and shareholder buyouts and run the debt process end to end. A term loan of up to 5x EBITDA can sit alongside the invoice or ABL facility, and the target's ledger can join the borrowing base.

Do you fund umbrella or limited company contractors?

Yes. Lenders fund invoices regardless of how the contractor is engaged, provided your contracts and compliance are in order.

Make every payroll run easy

Send us your aged debtor report and we will come back with indicative terms from recruitment specialist lenders.

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