The Best Invoice Factoring Services for Recruitment Agencies

Finance for recruiters has never been so fast, or so flexible. But what can invoice factoring do for your agency, and which provider should you choose?

Running a recruitment agency is a balancing act. You need to manage your in-house teams, make sure contractors get paid on time, and stay ahead of the competition, all while juggling the growth of your business. So when you have to worry about chasing up unpaid invoices, you’re bound to start dropping a few balls.

Invoice factoring gets rid of the hassle and guesswork of following up late payments. You’ll unlock up to 100% of the value of your outstanding invoices, and get the cash paid up front – often within 24 hours of requesting it. This means you can free up time to grow your business, and get a quick cash injection when you need it.

Are you struggling to free up funds to implement your next strategy? Can you not afford to wait weeks for that big client payout? Invoice factoring puts your funds back in your hands, and helps kick start the growth of your recruitment agency.

Fortunately, there are several invoice factoring services that specialise in financing for UK-based recruitment agencies. Here are the five that are doing it best.

Candidates waiting for an interview at a recruitment agency

The best invoice factoring companies for recruiters

Taking into account affordability, contract lengths, payout and decision-making speed, plus customer support, reviews, and flexibility – among other metrics – we rated the UK’s leading invoice factoring companies for recruiters.

According to our research, Sonovate comes out on top, and is the UK’s best invoice factoring provider for recruitment agencies. Yet it’s closely followed by Bibby Financial Services and Calverton Finance. Optimum Finance – last, but by no means least – rounds off our top four.

But which one is right for the unique needs and circumstances of your recruitment agency? Read on to find out. Alternatively, if you’d prefer to cut straight to the chase and receive tailored quotes from leading recruitment finance providers in the UK, we can help.

Simply take 30 seconds to provide us with some details about your recruitment agency’s needs. We’ll ask a few questions to determine if you’ve used invoice factoring before, how long you’ve been trading for, and a ballpark figure around how much your agency turns over annually.

We’ll use your responses to match you with one or more recruitment finance providers – but only if they’re a good match for your needs. These companies will then be in touch with you directly, to offer tailored recruitment finance quotes and advice.

Our form takes just 30 seconds to complete. Get started by answering the first question below!

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1. Sonovate

Best for recruitment-specific funding. Best all-rounder.

Catering to UK recruitment businesses of all sizes – from startups, all the way to those with over £150 million in annual turnover  – Sonovate is our top invoice finance pick for recruiters.

There are no setup fees, no debenture, and no personal guarantee required. Sonovate’s account setup and dedicated onboarding are some of the fastest we found, and you’ll even receive bad debt protection included as standard. You’ll pay just a single fee, and can receive up to 100% funding on both temporary and permanent staff – within just 24 hours.

Better still, there are no ‘all-turnover’ agreements – meaning that, when you make Sonovate your selection, you won’t have to factor your entire ledger of invoices to receive finance. For an entirely flexible, fuss-free arrangement that’s tailor-made for scaling recruitment agencies, it’s hard to look past Sonovate.

Sonovate recruitment finance dashboard

Sonovate is powered by a slick, user-friendly back office solution (pictured). It’s cloud-based, too, which means you can log in at anytime – and from wherever you are in the world – via an internet browser.

There’s nothing to download or install, and you can monitor the status of your funding – not to mention the overall health of your recruitment agency’s books – in real-time, with the utmost ease.

Customer review

“Sonovate’s team is fast and efficient, and provides great financial advice in a commercially driven, jargon-free way. Super-organised and proactive, the team really understands the industry and our business, which makes everything so much easier.

“It gives me great confidence to know that everything happens on time, and that I can receive answers in minutes – not days! Trust is a major factor, and with the service Sonovate provides, I feel supported at all times.”

Natasha, Sonovate customer

Sonovate is rated ‘Great’ on Trustpilot, with a 4.2/5 rating from 193 reviews.

Did You Know?

Based in Cardiff and London, Sonovate is one of the fastest growing providers of invoice finance for recruiters. It’s already funded over £1.5 billion across 40 countries, helping more than 25,000 people get paid in the process.


  • Full range of IR35 solutions available
  • 30-day rolling contracts
  • iOS and Android timesheet apps
  • Additional optional accounting service available
  • Flexible concentration limits
  • Excellent Trustpilot rating


  • Permanent funding is only available for larger businesses
Ask The Experts
Question symbol

What are the benefits of recruitment finance?

Sonovate logo
The Sonovate team
What kind of benefits can a recruitment finance provider offer your agency? We reached out to Sonovate’s team to find out:

”[By utilising invoice finance, a] recruitment agency engaged in both contract and permanent placements can increase its valuation as much as elevenfold.

“Invoice finance creates a foundation for ambitious recruiters to grow their temp/contractor book exponentially without worrying about cash flow. Advances in technology have also meant that recruitment businesses have a wider choice – from funding only, to both funding and a back office solution.”

For more information about the kind of advantages invoice factoring can provide for your agency, use the link below to jump down this article – we’ll discuss factoring’s top benefits for recruiters in further detail there!

Jump to: The benefits of invoice factoring for recruiters

2. Bibby Financial Services

Best for customer support. Highly rated online.

Bibby Financial Services is highly rated by its customers – and it’s not hard to see why! Along with dedicated live chat support from a team of seasoned industry experts, Bibby’s “Service Promise” demonstrates the company’s personal, customer-centric determination to go the extra mile.

Of course, Bibby’s own recruitment finance facility more than delivers. On top of up to 100% of your invoice’s value released within a day, you’ll benefit from the flexibility of Bibby’s 30-day rolling contracts, plus the simplicity of a single, bundled fee at the end of the month.

And, while Bibby’s online, customer-facing portal isn’t the most intuitive (think Microsoft Windows, but in the late 1990s), it is available 24/7, enabling you to take some of the guesswork out of planning for your agency’s future.

Bad debt protection isn’t included – as with Sonovate’s solution – though it’s still available for an additional fee.

Customer review

“I’ve been a client of Bibby’s for two and half years and counting. This is a very candid review of my experience so far.

“Everyone at Bibby has been responsive, flexible, professional, and helpful. I switched to Bibby after finding RBS inflexible and frustratingly risk averse/shortsighted. While Bibby takes all the precautions you’d expect, you still feel as though you’re dealing with human beings rather than computers, as is the case with the high street banks.

“Mark Wallace is my relationship manager, and I couldn’t be happier with the level of service he provides me with.

Gary, Bibby Financial Services customer


  • Superb Trustpilot rating
  • Friendly, responsive customer service with a personal touch
  • 30-day rolling contracts
  • Access to cash within 24 hours
  • Mark Wallace
  • Boasts nearly 40 years of experience funding the UK’s SMEs and recruitment agencies


  • Bad debt protection isn’t included as standard
  • The back office’s interface is pretty antiquated – and not particularly easy to use, either!
Ask The Experts
Question symbol

Is now a good time to start using recruitment finance?

Gary Davis headshot
Gary Davis
Head of UK Sales, Bibby Financial Services

We got in touch with Gary Davis, Bibby’s UK Head of Sales, for some info about why there’s never been a better time for recruitment agencies to utilise invoice finance.

”Historically, as we come out of a recession, employers tend to opt for the flexibility of temporary manpower, rather than full time employees – at least until such time as there is certainty around the economy.

“This generates a huge uptick in turnover for temporary recruitment agencies, which – whilst welcome – creates a large need for cash, as temporary workers often have to be paid by the agency well in advance of the client settling [the agency’s] invoice.

“This gap in funding is perfectly plugged by the use of invoice discounting and factoring, where up to 90% of the invoice’s value can be made available immediately. Moreover, as the agency grows, the availability of cash increases, as it’s directly proportionate to the business’s turnover”.

You’re halfway through our list of the top four invoice factoring services for recruitment agencies. Time to start comparing quotes?

Simply hit one of the buttons below to start our quick questionnaire. It takes just 30 seconds to do, and by telling us more about your business’ specific requirements, we can help ensure that you receive the best, most personalised rates on recruitment finance.

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3. Calverton Finance

Best for small recruitment agencies. Fast approval and payouts

Among the leaders of industry-specific invoice factoring for recruiters is Milton Keynes-based Calverton Finance. You can be approved in principle within five minutes, and remain confident that Calverton’s simple, transparent one-fee structure will keep costs to a minimum.

Better still is Calverton Finance’s back office solution – dubbed ‘PayFactory’ – which is tailor-made for growing recruitment agencies, both temporary and permanent. PayFactory is a complete software solution that encompasses invoicing and payroll, while also letting you stay on top of your funding and collections in real time.

Customer review

“I’ve worked with Calverton Finance for over a year now, and found its service to be second to none – customer service is clearly massively important to the company.

“As a small factoring company, it doesn’t have the layers of management that bigger companies have, which means decisions are made really quickly.

“If I have a problem, there’s always someone available to help. If you want great service and flexible finance to get your business through these tough times, I would highly recommend Calverton.”

Richard, Calverton Finance customer

Calverton Finance is rated ‘Average’ on Trustpilot, with a 3.4/5 rating from just three reviews.


  • You can purchase bad debt protection for an additional fee
  • Offers both short-term and long-term deals
  • A confidential facility is also available


  • Its online customer reviews aren’t as strong across the board as several of the other recruitment finance providers listed here

4. Optimum Finance

Best for a bespoke approach to recruitment finance.

The dictionary defines optimum as ‘the most favourable situation or level for growth or success’ – and that sums up Optimum Finance pretty nicely. With a tailored approach and a range of quick, no-nonsense invoice finance options, Optimum Finance is sharply attuned to the needs of UK recruitment agencies.

The Bristol-based company – which also happens to be one of the UK’s fastest-growing invoice finance firms – will advance up to 90% of your ledger’s value. It also offers both factoring and discounting, plus a fully flexible CHOCS (Client Handles Own Collections) service. Bad debt protection is available at extra cost, and Optimum Finance works to ensure that the recruitment factoring facility you receive is one that’s customized completely to the unique needs of your agency.

With Optimum Finance, you’ll also score access to ‘E3.’ Nope, that’s not the postcode in London’s East End – it’s Optimum’s online back office system, from which you can manage your account in real-time; 24 hours a day, all year round.

Customer review

“Invoice factoring is essential for a recruitment agency – we have to pay workers before we get paid ourselves. It allows us to have sufficient cash flow, so that we can continue to grow the business. One of the key things with Optimum at the moment is that their customer service is absolutely spot on. We get the highest quality service, and we know that we can rely on what they say.

They can provide us with the facilities that we need [and] the credit limits that we need, which means we do have access to cash flow, and it doesn’t stunt the growth of the business.”

Nathan, Optimum Finance customer

Optimum Finance doesn’t currently have a rating on Trustpilot.


  • Its cost calculator allows you to figure out exactly how much you can expect to pay in fees – and how much funding you’ll be able to receive
  • Excellent (and fully UK-based) customer support
  • Straightforward application, approval, and onboarding processes


  • Doesn’t release as large a cash advance as other recruitment finance providers on our list
  • ‘E3’ isn’t as user-friendly as other back office solutions, particularly Sonovate’s
  • Lacks a substantial amount of customer reviews online

What is invoice factoring for recruiters?

According to our own independent research, around 30% of the people that come to our site for invoice factoring content are recruiters. Yet guess what? Less than half of those readers (44%) have previous factoring experience. 

That’s why we decided to break down exactly what the recruitment finance process involves. Take a look at the diagram for a visual idea, or scroll on as we break down each step below.

Invoice factoring for recruitment explained

The whole point of recruitment finance is to bridge those seemingly interminable waits for your invoices to be paid. You have to pay your workers weekly, but your client – who you’re sending those workers to, after all – can often take up to 90 (or worse, 120!) days to pay you.

It all amounts to a lack of cash flow – the key ingredient for the growth of any business – and it just isn’t fair.

Here’s where recruitment finance comes in. When you’re approved and all signed up (this won’t take long, so don’t fret!), you can submit your unpaid invoices to your chosen invoice factoring provider. It’ll release around 85 to 90% (though this is often up to 100%) of the invoice’s value, providing you with a quick cash injection.

With this extra liquidity lining your business’s stomach, you can pay your temporary workers, and turn that voracious appetite into growing your recruitment agency – not simply running it!

So, now you’ve been paid by the invoice finance provider, and you, in turn, have paid your workers. You’re not quite done yet, though – you’re still owed money by your client, after all!

Here’s where invoice factoring companies for recruitment agencies really come into their own. Once you’ve received that cash advance from the provider, its credit control team will then assume responsibility for chasing your client for payment. Essentially, this means that you’ve effectively managed not only to gain finance on your unpaid invoices, but outsource your agency’s credit control, too.

Of course, if you’d prefer to chase your own debts – which, to be fair, is a great way of ensuring your maintain control of your own client relationships – there are usually options for this, too. The most popular is called CHOCS, and most of the UK’s leading recruitment finance providers offer the flexibility of this service.

What are the benefits of recruitment finance?

After getting to grips with the UK’s five top invoice factoring companies for recruitment agencies, you’ll already be well acquainted with the kind of benefits you can expect from this type of finance.

In case it slips your mind, though, we’ve assembled a handy acrostic to hammer home the key advantages that recruitment finance can have for your agency. Enjoy!

The benefits of invoice factoring for recruiters

Reduce your administrative workload

As we just mentioned, recruitment finance providers can handle credit control for you – if you want them to, that is.

If you choose to go down this route, it’ll save your staff plenty of time they’d otherwise spend chasing your clients for payment, or juggling funds to free up cash flow.

Encourage prompter payments from your clients

For your clients, knowing that you’re using a finance provider can be just the thing that kickstarts them into paying your bill faster. Because who really wants to have to wait almost four months to be paid?

Curb the effects of bad debt

When a client owes you money, the last thing you want is for them to be unable to pay it. Yet when a company declares bankruptcy, or becomes insolvent, this is exactly what can happen.

Fortunately, most invoice factoring companies catering to recruitment agencies understand the vices and vagaries of the industry – particularly when you’re chasing big bills. That’s why the majority of recruitment finance providers offer something called ‘bad debt protection’.

Put simply, it means that the factoring company assumes responsibility for the money your client owes to you. If that client goes bust – and the debt, accordingly, goes ‘bad’ – you won’t be out of pocket because of it.

For obvious reasons, this additional service costs extra!

Receive expert advice from industry pros

Most recruitment finance companies come with dedicated support – whether that’s via live chat, phone, email, or a variety of online help resources. 

These people know more about recruitment, finance, and, well… recruitment finance than most of the rest of the world – so it’s a godsend to have them on hand when an issue crops up, or when you need expert industry advice!

Use increased cash flow to grow your business

Cash will always be king – and having it is the key to realising your agency’s scalability ambitions.

When you use a recruitment finance provider for an upfront advance, you don’t just ‘unlock’ the value of your unpaid invoices – you free yourself from the manacles that cash flow (or, more accurately, a lack of it) places on your business’s growth, too.

Improve your planning for the future

Not knowing when you’re going to be paid can seriously stymie your recruitment agency’s capacity to plan for the future. 

Invoice factoring, of course, does away with this uncertainty entirely. In most cases, you’ll see the money in your account within 24 hours, meaning you can take stock, and plan for what’s ahead – even in what is, objectively, a pretty uncertain period – with the utmost confidence.

Tailor a solution to the needs of your business

Typically, finance products aren’t built around what’s best for the lender, but rather the interests of the provider. With recruitment finance, that’s a bit different.

For one thing, this is because your agency is only borrowing funds related to work you’ve already completed – or, should we say, money that’s already owed to you. It’s not like taking out a traditional business loan, in that the funds come with collateral, massive interest rates, or the looming, unspoken terror that you may not be able to pay it back.

As well as being flexible – and considerably less anxiety-filled – than regular finance, invoice factoring for recruitment is also completely bespoke. The solution you receive will be tailored entirely to your agency’s turnover, as well as the amount of funding you’re seeking.

Next steps

Recruitment finance: fast, flexible, and fuss-free. But which provider should you choose? If you’re anything like us, that’d be Sonovate.

Sonovate is our top all-round invoice factoring pick for recruiters, thanks largely to its simple, scalable approach, and the clever, capable qualities of its back office software platform.

However, there are plenty of other options. Bibby Financial Services has the best customer support. Calverton approves quickly and pays out even quicker, while Optimum Finance’s tailorable, customisable approach reflects the dynamism and quick-thinking of your recruitment agency.

Still not sure? Relax – there’s an even easier way to find the right recruitment finance provider for you.

Simply hit one of the buttons below to start our quick, quote-finding questionnaire.

Doing so provides us with some details about your recruitment agency’s needs. We’ll ask about:

  • Whether you’ve used finance before
  • Your industry (although, since you’re here, we already have a little idea)
  • How long your business has been trading for (over/under one year?)
  • What type of customers you work with – businesses, customers, or a mixture of both?
  • Your agency’s expected annual turnover

When you’re done, we’ll use your responses to match you with one or more of the UK’s leading recruitment finance providers – but only if they meet your requirements. These providers will then be in touch with you directly to offer more information about the invoice factoring process for recruiters, along with tailored, no-obligation quotes and advice.

It takes just 30 seconds to do, and is totally free for UK-based businesses.


How long will it take to set up my recruitment finance account?
The time it takes to get your account up and running will depend on the provider, but you can safely expect it to be in the region of weeks, rather than days – or months!

Once you’re underway, however, things speed up considerably. Indeed, most recruitment finance providers release funds within a day of you submitting the invoice. Zippy!

You mention both invoice factoring and discounting for recruiters. What’s the difference?
Good question! Factoring and discounting are both very similar, but with one – quite important – distinction…

Credit control. With a factoring solution, the recruitment finance provider will assume the role of settling the debt with the customer. Your client will settle the funds it owes to your agency directly with the factoring company.

Invoice discounting doesn’t outsource your credit control – but you’ll retain control over your credit. Basically, it’s like factoring, only you’re in charge of chasing your own debts.

The key difference here boils down to confidentiality. If you’re more of a ‘hands-off’ type, and don’t mind your clients knowing that you’re using finance, factoring will work a charm. If you’d prefer to keep a lid on your involvement with a third-party recruitment finance and credit control company, then discounting is a safer bet.

Can I receive recruitment finance with a bad credit rating?
Obtaining recruitment finance with a bad credit score is entirely possible. Unlike traditional forms of funding – where lenders are prone to running a mile at even the first whiff of anything resembling bad credit – invoice factoring providers can afford to be a bit more lenient here.

Factoring companies tend to be more interested in the creditworthiness of clients, rather than your own business. After all, it’s your clients that the recruitment finance provider is going to be pursuing for repayment, not you!

There are no prices listed for the providers above. How come?
There’s no ‘one size fits all’ approach to invoice factoring – particularly when it comes to recruitment.

UK recruitment companies come in all shapes and sizes, from one-person outfits to huge, enterprise-level agencies – so, understandably, recruitment finance rates will differ accordingly.

This is why most factoring providers don’t advertise their rates transparently. To gain a better understanding of what your agency can expect to pay, you can enquire directly with the company, or utilise our quote-finding form for quick, no-obligation quotes that are tailored to your needs.

What’s the best invoice factoring company for a small business?
If your business is still in the early stages of its growth – and you’re confident that it could benefit from invoice finance’s fast, flexible form of funding – you should look into what a dedicated small business invoice factoring solution can do for you.

We’ve compiled a list of the top invoice factoring companies for small businesses in the UK – go check it out!

Written by:
Rob Binns
Rob writes mainly about the payments industry, but also brings to the table industry-specific knowledge of CRM software, business loans, fulfilment, and invoice finance. When not exasperating his editor with bad puns, he can be found relaxing in a sunny (socially-distanced) corner, with a beer and a battered copy of Dostoevsky.