Invoice Finance for Recruitment Agencies
By Joshua Giles, Founder and Director · Reviewed by the CoreFi credit team
Last updated 20 July 2026
CoreFi is a broker, not a lender. We do not set rates and lenders make all credit decisions.
In short: Invoice finance lets a recruitment agency draw around 85% to 90% of each placement invoice on the day it is raised, instead of waiting 30 to 60 days while contractors still need paying every week. Facilities typically run from £25k to £5M and flex with your ledger. We are a broker and place factoring and discounting with recruitment-friendly lenders.
Recruitment has a structural cash problem that most business finance products were not built for. You pay contractors every Friday. Your end-client pays your invoice in 30, 45, sometimes 60 days. That gap is the business. Invoice finance closes it by advancing you around 85 to 90 percent of each placement invoice on the day it is raised, with the balance (less the lender's fee) paid over when the client settles.
The lenders who do this well are not the high street banks. They are a small group of specialist recruitment finance providers who understand temp and contract billing cycles, and they build real back-office services into the facility: payroll processing, timesheet portals, holiday pay calculations, and credit checks on new clients before you take them on. That last point earns its keep. A bad end-client can sink a contractor desk, so the lender's credit-checking function is part of what you pay for.
Advance rates track the shape of your debtor book. Concentrated ledgers, where one client takes more than 25 to 30 percent of billings, draw closer scrutiny and sometimes a lower advance rate on that slice. Spread the book and the facility gets cheaper. Start-up agencies with no trading history can still get funded from day one, because these lenders underwrite the end-client, not just the agency. We place these facilities regularly and know which providers move fast on a clean debtor book.
Key Benefits
- Contractor payroll funded from the day you invoice, not from reserves you may not have
- Around 85 to 90 percent of invoice value advanced on submission, with the balance on client settlement
- Facility limit grows as you place more contractors, so you are not renegotiating every quarter
- Lender credit-checks each new end-client before you accept the assignment, cutting bad-debt exposure
- Payroll, timesheet management, and holiday pay administration built into the facility rather than bolted on
Frequently Asked Questions
Can a new recruitment agency get invoice finance?
Yes, and this is one of the few sectors where that holds true. Specialist recruitment lenders underwrite the creditworthiness of your end-clients rather than your own trading history, so a start-up agency placing good-quality clients on contract can get a facility from day one. Approval is never guaranteed and rests on the lender's assessment of your ledger.
Does it cover both temporary and permanent placements?
Temp and contract billing is what these facilities are built around. Permanent placement fees can also be funded, though the advance rate and fee structure often differ because a perm invoice is a one-off rather than a recurring ledger item. Tell the lender upfront if perm fees make up a meaningful share of your turnover, and we will flag the providers that handle both well.
What back-office services are included?
It varies by lender. The stronger recruitment finance providers include payroll processing, pension auto-enrolment, holiday pay calculations, timesheet portals, and credit reporting on your clients. Some charge for these separately; others fold them into the facility fee. We confirm exactly what is and is not included before you sign anything.
How quickly can I be set up?
A specialist recruitment lender can often complete setup in around 5 to 10 working days, and once the facility is live, individual invoices are usually funded quickly after submission. No broker can promise a specific timeline because the lender's due diligence governs it, but the better providers are used to moving at recruitment pace.
Invoice Finance calculator
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Cash advanced now
£42,500
Fee
£750
Net received
£49,250
Held back
£7,500
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Related Funding Options
Invoice Finance UK: Fund Your Sales Ledger, Not Your Property
Invoice finance advances up to 90% of an unpaid invoice, often within a day of raising it. We place factoring & discounting facilities for UK limited companies across most sectors, with no property charge required.
Unsecured Business Loans for Recruitment Agencies
Unsecured business loans for UK recruitment agencies: fund a new desk, a CRM upgrade, or the gap before invoice finance goes live, without putting up property. We place these deals with lenders who read recruitment accounts properly.
Revolving Credit for Recruitment Agencies
A revolving credit facility lets UK recruitment agencies draw on payroll cash when placements spike and repay when clients settle. We place these from £25k to £2M.
Invoice finance by location
Lender appetite varies by city and region. If you would rather start from where your business is based, these local guides cover the same funding with the local picture.
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Get matched with lendersCoreFi is a trading name of JG Core Ltd (Company #16218779, England & Wales). CoreFi acts as a commercial finance broker and does not provide regulated financial advice. All products described are unregulated business-to-business finance. Information on this page is for general guidance only and does not constitute a formal offer of finance. Terms, rates, and availability are subject to lender criteria and may change without notice.