Recruitment Funding Solutions Review
Recruitment Funding Solutions is a specialist invoice finance provider that works exclusively with recruitment agencies. They accept startups, which is a significant advantage in a market where most providers require at least one year of trading history. Their sole focus on recruitment means they understand the sector's unique cash flow challenges, including back-to-back temp payroll and margin pressure.
Recruitment Funding Solutions is a recruitment-only invoice finance specialist that accepts startups, with advance rates around 85% and service charges from 1.5%.
More detail + scope
Summary
Recruitment Funding Solutions works exclusively with recruitment agencies and accepts startups, a significant advantage where most providers require at least a year of trading. Advance rates run around 85% with service charges from 1.5% and discount charges at base rate plus 3.5%. Its sole recruitment focus means it understands back-to-back temp payroll and margin pressure.
This page covers
Recruitment Funding Solutions recruitment invoice finance, startup acceptance, advance rate and pricing
Not covered here
General invoice finance education (see /guides/), non-recruitment sectors (see /industries/), the full provider directory (see /providers/)
Key Facts
When Recruitment Funding Solutions Fits
-
New recruitment agency (£0-£500k turnover) placing temps or contractors
One of the few UK providers that will fund recruitment startups with no trading history. They understand the cash flow gap between paying temps weekly and receiving client payment 30-60 days later.
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Established agency (£500k-£5m turnover) expanding into new sectors or geographies
Sector-specific credit assessment means they can evaluate candidate quality and client creditworthiness in recruitment terms, often approving facilities faster than generalist providers.
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Agency temporarily struggling with concentration risk (one large client represents >40% of invoicing)
Unlike high-street banks, recruitment specialists typically handle client concentration better because they understand the sector's natural tendency toward key account relationships.
When to Look Elsewhere
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Multi-sector staffing business (recruitment plus healthcare, education, industrial)
Better fit: Bibby Financial Services. Bibby offers cross-sector facilities where one provider can fund multiple business divisions under a single agreement.
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Agency invoicing under £20k monthly with strong retained search income
Better fit: Optimum Finance. Smaller minimum facility size may suit micro-agencies, though recruitment specialists like RFS often have better sector knowledge.
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Permanent-only recruitment business with predictable quarterly fee income
Better fit: Kriya. Digital lenders may offer cheaper unsecured working capital for perm-only agencies without the complexity of invoice finance.
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Large agency network (£10m+ turnover) needing international invoice purchase
Better fit: HSBC Invoice Finance. High-street banks provide multi-currency facilities and overseas debtor insurance for agencies placing contractors abroad.
How Recruitment Funding Solutions Compares
| Provider | Type | Min facility | Fee from | Advance to | Speed |
|---|---|---|---|---|---|
| Sonovate | both | £50k | 0.75% | 95% | 3 days |
| Hydr | discounting | £100k | 0.8% | 90% | 5 days |
| Ultimate Finance | both | £100k | 1.2% | 85% | 7 days |
| Close Brothers | both | £250k | 0.9% | 90% | 10 days |
vs Sonovate: Tech-first platform with automated compliance checks and real-time funding, but typically requires 12 months trading history versus RFS accepting startups.
vs Hydr: Confidential invoice discounting only, so your clients never know you're using finance, but startup agencies usually need visible factoring support first.
vs Ultimate Finance: Generalist provider funding recruitment among 20+ sectors, so less nuanced understanding of temp payroll cycles and right-to-work compliance risk.
vs Close Brothers: Part of FTSE 250 banking group offering recruitment finance, higher minimum facility suits established agencies but less accessible for startups.
Worked Example
A Manchester-based recruitment startup specialising in IT contractors, three months trading, £180k annual run-rate
Setting Up With Recruitment Funding Solutions
- 1
Initial application and sector assessment
Submit trading history (or business plan if startup), sample client invoices, and details of temp workers or contractors. RFS reviews your candidate vetting process and client credit quality through a recruitment lens, not generic commercial criteria.
- 2
Client notification and credit checks
For factoring arrangements, RFS contacts your clients to verify invoices and set up payment redirection. They run credit checks on each client debtor. Startups often see 3-5 initial clients approved, expanding as the relationship matures.
- 3
Payroll integration and first drawdown
Link your payroll system (many recruitment agencies use Hireserve, Bullhorn, or Firefish) so weekly temp pay runs trigger automatic funding requests. First advance typically arrives within 24 hours of invoice approval, then same-day for repeat clients.
FAQs
Do you fund brand-new recruitment agencies with no trading history?
Yes. Recruitment Funding Solutions is one of the few UK providers that will fund recruitment startups from day one. You'll need a credible business plan, evidence of candidate pipelines, and ideally a director with prior recruitment industry experience. Expect lower initial advance rates (70-80%) and closer monitoring in the first six months, increasing as you demonstrate consistent invoicing and client payment behaviour.
How do you handle umbrella company invoices and PAYE temp workers?
They fund both models. For umbrella workers, RFS advances against your margin invoices to the client (the umbrella handles payroll). For PAYE temps, they advance against the full invoice value and you pay temp wages from the advanced funds. Most recruitment agencies find PAYE through invoice finance cheaper than using umbrella companies, which charge 10-15% margin plus employer NI.
What happens if a temp worker fails right-to-work checks after I've been funded?
Recruitment-specialist providers like RFS build compliance risk into their underwriting. If a placement falls through due to failed compliance before the client pays, it's typically treated as a credit note against your facility. Persistent compliance failures will trigger facility review. They expect agencies to use robust right-to-work verification, and some offer discounted rates to agencies using Home Office-approved digital ID checks.
Can I use this alongside my existing PAYE/umbrella credit line?
Yes, though most agencies find invoice finance replaces the need for separate payroll credit. If you have a temp pay facility with a provider like Triver or Sonovate, RFS can work alongside it, but expect them to take a first charge over your debtor book. Coordination between funders adds complexity, so many agencies consolidate to one recruitment finance provider once they outgrow startup phase.
How quickly can I access funds for emergency Friday payroll runs?
Once your facility is established and clients are pre-approved, same-day funding is standard for repeat invoices submitted before midday. New client invoices require credit checks, typically 24-48 hours. Most recruitment agencies submit timesheets Monday-Wednesday for Friday client invoicing, giving 2-3 days for approval and funding before temp payroll is due.
Our Verdict
Recruitment Funding Solutions is one of the best options for recruitment agencies, particularly startups launching with limited trading history. The 100% recruitment focus means every aspect of their service is tailored to the sector. Businesses outside recruitment will need to look elsewhere, but for agencies at any stage this is a provider worth contacting.
Director, Market Invoice
Oliver leads Market Invoice's editorial and comparison research. With a background in UK commercial finance, he oversees provider analysis, rate verification, and industry reporting across all verticals.
Last reviewed: 8 April 2026