Scaling your Recruitment Business with Invoice Finance: Unlocking Growth Potential

Growing a recruitment business is an exciting yet demanding venture. A common challenge faced by many businesses in this sector is cashflow management. With invoices often outstanding for weeks or even months, it can be difficult to allocate funds for essential business growth activities such as new business development, hiring additional staff, or pursuing larger clients. This is where Invoice Finance emerges as a valuable tool.

By transforming unpaid invoices into immediate working capital, Invoice Finance provides a much-needed financial boost. This enables recruitment businesses to seize opportunities promptly, whether it's recruiting new consultants, expanding into new markets, or investing in targeted marketing campaigns.

Key Benefits of Invoice Finance for Recruitment Businesses:

• Accelerated Cashflow: Receive a substantial portion of the invoice value upfront, improving cashflow management and reducing reliance on overdrafts or loans.

• Increased Capacity: Take on more clients and larger contracts without compromising your financial stability, as Invoice Finance provides a steady cashflow.

• Strategic Investments: Utilise the freed-up working capital to invest in areas that drive growth, such as advanced recruitment software, employee training, and talent acquisition.

• Risk Mitigation: Enhance your business's resilience by diversifying income streams and improving overall cashflow management.

• Focus on Core Business: Delegate credit control and invoicing to your Invoice Finance provider, allowing you to concentrate on the development of your business.
  
  

Invoice Finance can be a strategic tool for recruitment businesses who are seeking sustainable growth. By improving cashflow, it allows businesses to focus on development, invest in talent, and seize new opportunities. It's essential to carefully consider your business's specific needs and explore different Invoice Finance options to determine the best fit. At Skipton Business Finance, we tailor our solutions to the individual needs of each business and ensure it is the right fit for them.

Contact Skipton Business Finance today to explore how Invoice Finance can fuel your business’s growth.

The Lurking Threat Not Enough of You Are Talking About

We are currently living in an increasingly uncertain world. Global geo-political events are shaping our future and having a very real impact on us in our personal and business lives. We are also living through one of the biggest technological changes for generations…Artificial Intelligence.

While all eyes are focused on geo-political events, we are also distracted and enthused by the possibilities of AI and the excitement that comes with that possibility.

The scary thing that most are not focused on (while we’ve been a little distracted by the above) is the rising and very real threat of cybercrime.

The Elephant in the Room

Most businesses are aware of the need for cybersecurity, but many are burying their heads in the sand about how profound the risk is and equally how daunting it can be to start addressing the threat.

If you spend a little time focusing on recent news reports of ransom attacks, cybercrime, state-sponsored cyber attacks, and the rise of AI-supported cybercriminal activities, you will quickly see why this probably should be the most critical item on every C-Suite leader's agenda.

The Business of Cybercrime

Hackers are increasingly running their operations like businesses. They entrap a business, request a ransom to unlock systems, or prevent sharing data. Many organizations end up paying significant sums to avoid their business going under or suffering reputational damage that they may not recover from. I’ve heard of eye-watering sums being paid to criminals who you are “trusting” in good faith that they will keep their word and restore your access or not leak your data.

Misplaced Confidence

Currently, businesses are convincing themselves that their IT provider or internal team has them covered. Your data is in the Microsoft cloud, so we are safe…we have cyber essentials…we are safe.

Unfortunately, you are not.

A Changing Landscape

The cybersecurity landscape has (and is) changing at a rapid pace. It is not just a technology problem but a business problem that needs to span the education of your staff, policies and procedures, technology, and the appropriate levels of support.

Taking Action

Just like NATO and the target for member states to contribute 2.5% of their GDP to security, so too should leaders be thinking about the investments they make into their business security posture. Here are some actionable steps to enhance your cybersecurity:

1. Conduct Regular Security Audits: Identify and address vulnerabilities in your system.

2. Employee Training: Educate your staff about phishing scams and other common cyber threats.

3. Invest in Advanced Security Technologies: Ensure your security measures are up to date with the latest advancements.

4. Implement Robust Policies and Procedures: Develop and enforce comprehensive cybersecurity policies.

Don’t become another statistic of this ever-expanding new business line for cyber criminals. Take the appropriate actions as soon as possible.

Free Security Assessment

If this article has raised some alarm and concern, I’m glad. It has served its purpose, and you should be concerned.

As members of the Recruitment FD group, I’ve opened up a limited number of free quick assessments where I can independently review your current posture. They are open to any company with a minimum of 50 employees with a budget and willingness to address the issues raised. This will be on a first-come, first-served basis. To take advantage of this, please email me at brad@intercor.co.uk.

Is complex payroll system dramatically affecting your employee turnover?

Consider these alarming statistics:
44% of the 4000 employees surveyed had been paid late by their employers. 
48% of those who had been paid late (44% of the 4000) had also paid incorrectly. (Source: sdworx)

Once an employee has experienced two paycheck errors, 49% of them will look for a new job. (Source: Thrive my way)

Is your business grappling with the complexities of payroll management? 
You're not alone.
But first understanding the risks involved is crucial.

Major Risks in Payroll Processing:
Data security threat
Timekeeping fraud
Reimbursement fraud
Buddy punching 
Non-compliance

Feeling overwhelmed? 
Don't worry; IMS Decimal has your back.

Here's how IMS Decimal supports you while you focus on your core business:
1) 24*7 365 availability 
2) Onshore support 
3) GDPR compliant 
4) ACCA-approved employer 
5) Cost transparency 
6) Flexible contracts

Get in touch with our experts today. - https://imsdecimal.com/contact-us/

8 reasons why consistent cashflow enables growth in the recruitment sector

Recruitment businesses thrive on the ability to maintain a steady cashflow, which is crucial for both sustainable growth and operational efficiency. For many growing recruitment businesses, partnering with Skipton Business Finance can be a game-changing strategy. We’ve partnered with hundreds of recruitment businesses over the past 21 years, giving us what we think is extensive expertise in the industry, whilst at the same time helping those businesses achieve a consistent cashflow cycle.

Here are our eight reasons why a consistent cashflow cycle is vital for enabling growth in recruitment businesses.

1. Enhanced Operational Stability

With consistent cashflow facilitated by invoice financing, recruitment businesses can ensure they have the necessary funds to cover operational costs, including payroll, rent of office space, and other overheads, such paying their contractors. This stability is crucial for maintaining smooth operations.

2. Improved Financial Planning and Forecasting

A steady cashflow enables better financial planning and forecasting. Recruitment businesses can accurately predict their financial position, allowing for more strategic decision-making and resource allocation. This predictability helps in setting realistic growth targets.

3. Increased Flexibility and Agility

Access to immediate funds allows recruitment businesses to be more agile in responding to market opportunities. Whether it's expanding into new sectors, investing in marketing campaigns, or hiring additional staff to meet demand, the availability of cash ensures that businesses can act swiftly without being hampered by the late payments of your customers.

4. Strengthened Client Relationships

Timely payment of contractors contribute to higher client satisfaction. Recruitment businesses can deliver consistent, reliable service, which strengthens client relationships which will inevitably enhance their own reputation. Happy clients are more likely to offer repeat business and referrals, thus driving growth.

5. Mitigation of Credit Risk

At Skipton Business Finance we work with our clients to help perform credit checks on their own clients, providing recruitment businesses with valuable insights into the creditworthiness of their prospective clienteles. This reduces the risk of non-payment and bad debts, ensuring that the business maintains a healthy cashflow which can help minimise financial losses.

6. Scalable Financing Solutions

As recruitment businesses grow, their financing needs evolve. Invoice finance is scalable, meaning the funding available grows in line with the business’s own growth. This scalability is particularly beneficial for rapidly expanding firms that need increasing amounts of working capital to support their growth trajectory. Here at Skipton Business Finance, we tailor our solutions to that of the growing demands of our clients.

7. Reduction of Administrative Burden

Managing accounts receivable can be time-consuming and resource-intensive. By outsourcing this function to an invoice finance lender, for example as part of a factoring facility, recruitment businesses can reduce their administrative burden. This allows internal teams to focus on core activities such as talent acquisition, client engagement, and strategic planning. Of course, if you prefer to manage your own credit control, Skipton Business Finance has solutions such as Invoice Discounting that may be more suitable.

8. Enhanced Competitive Advantage

A consistent cash flow provides a competitive edge. Recruitment businesses can offer better payment terms to clients, invest in other technologies and attract top talent. These advantages collectively enhance the business’s market position and ability to compete effectively.

Talk to Us

For growing recruitment businesses, maintaining a consistent cashflow cycle is essential for achieving sustainable growth. Partnering with Skipton Business Finance will play a pivotal role in ensuring this consistency by providing your business with immediate access to working capital. By utilising the benefits of invoice finance, your business can enhance stability, agility, and competitive advantage.

To talk about how Skipton Business Finance can help your business, please call 0845 602 9354, email info@skiptonbf.co.uk or visit Skipton Business Finance.

Cash Flow Mastery? How Recruitment Firms Can Crack the Code & Secure Their Growth

The Code is not a reference to Nemo’s Eurovision win. Yet, this very strength—connecting businesses with the right people—can become a financial challenge. The cyclical nature of hiring, delayed client payments, and the need to invest in technology can wreak havoc on cash flow. 

1. The Feast-or-Famine Cycle: Recruitment often experiences boom-and-bust cycles. A successful placement can lead to a substantial influx of cash, but extended periods without successful placements can cause severe cash crunches. This makes it hard to budget and plan for expenses like payroll and marketing.
   
   

2. Delayed Client Payments: Standard payment terms for placement invoices can range from 30 to 90 days (or even longer). This lag between completing a placement and receiving payment can severely strain cash flow, especially for smaller firms.
   
   

3. High Upfront Costs: Before placements are finalised, recruitment agencies invest significant resources in candidate sourcing, screening, and interview processes. This can tie up capital that's not immediately recouped, further impacting short-term cash flow.
   
   

4. Talent Competition: Attracting and retaining top recruiters often requires competitive compensation packages, including commissions. This can create unpredictable cash outflows, especially when successful placements are unevenly distributed.
   
   

5. Technological Investments: Staying competitive in the digital age means investing in applicant tracking systems, online job boards, and other tech tools, which can add up quickly.
   
   

6. Regulatory Compliance: Ensuring compliance with employment laws and industry regulations often requires financial resources for training, legal counsel, and potential audits.
   
   

These challenges highlight the need for recruitment firms to adopt proactive cash flow management strategies and leverage financial tools specifically tailored to their industry's unique demands.

Adding to the pain, finance teams building cash flow projections often rely on cumbersome spreadsheets and data that don't effectively capture the nuances and pain outlined. 

Enter Numarqe, a financial platform designed for recruitment firms. By providing tailored corporate credit solutions, Numarqe empowers recruitment agencies to navigate the financial landscape, seize growth opportunities, and focus on what they do best: finding the perfect candidates.

Understanding Cash Flow in the Recruitment World

For recruitment firms, cash flow isn't just about money coming in and going out—it's about managing the ebb and flow of talent acquisition.

• Operating Activities: This includes revenue from successful placements, commission payments to recruiters, and day-to-day operational expenses like office rent and marketing costs.

• Investing Activities: Cash flow from investments might be less relevant here but could involve upgrading recruitment software or expanding to new office locations.

• Financing Activities: This is where Numarqe shines, offering flexible credit lines to bridge cash flow gaps caused by delayed client payments.

Essentials of Cash Flow Projection for Recruitment Firms

Cash flow projection is like having a crystal ball for your recruitment finances. It's crucial for:

• Managing Payroll: Ensuring you have enough cash to pay your recruiters' salaries and commissions on time.

• Investing in Growth: Knowing when you'll have the resources to expand your team, market your services, or invest in technology.

• Navigating Seasonality: Anticipating and preparing for slower periods in the hiring cycle.

• Building Client Relationships: Demonstrating financial stability to clients reassures them of your professionalism and reliability.

A Simple Step-by-Step Guide that Focuses on Recruitment

1. Time Horizon: Project cash flow for at least 12 months, considering potential seasonal fluctuations in hiring.

2. Gather Data: Look at historical placement data, average time-to-fill for roles, and client payment terms.

3. Project Inflows: Estimate revenue based on anticipated placements, factoring in payment terms and any known delays in client payments.

4. Project Outflows: Forecast recruiter salaries, commissions, marketing expenses, software subscriptions, and other operational costs.

5. Calculate Balances: Determine opening and closing balances for each period.

6. Contingency Planning: Incorporate buffers to prepare for unexpected events.

7. Rolling Forecasts: Regularly update projections based on actual performance.

Pitfalls to Avoid in the Recruitment Industry

• Underestimating Time-to-Fill: Overly optimistic projections of when placements will be made can lead to cash flow gaps.

• Ignoring Client Payment Cycles: If clients typically pay invoices late, failing to factor this in will skew your projections.

• Overspending on Marketing: While essential, marketing costs can quickly escalate.

• Unexpected Costs: Unforeseen expenses, such as legal fees or sudden IT needs, can arise quickly in recruitment.

• Failing to Prioritise Contingency Planning: Insufficient buffers make it challenging to handle unforeseen expenses.

The traditional way of compiling cash flow projections in spreadsheets can be cumbersome, especially as businesses grow and transactions become more complex. This is where modern automation tools and tailored corporate credit solutions play a significant role.  Solutions like Numarqe are designed to streamline the process and enhance the accuracy of cash flow projections.

Cash Flow Automation: A Recruiter's Best Friend

Automation streamlines and simplifies the often complex cash flow management process that recruitment firms face. It enables you to:

• Focus on Placements: Freeing up valuable time for your finance team to focus on core business activities.

• Gain Real-Time Visibility: Understand your cash flow in the moment, not just at the end of the month.

• Make Data-Driven Decisions: Leverage insights on spending trends, client payment patterns, and overall financial health.

• Scale with Confidence: Ensure your cash flow management tools can handle your growing business.

Numarqe, in particular, offers recruitment firms a comprehensive solution with its automated cash flow projection and corporate credit offerings.

Numarqe: Your Cash Flow Powerhouse

Numarqe's credit platform empowers recruitment firms to tackle the financial challenges unique to the industry, which legacy financial institutions fail to meet. Numarqe focuses on:

• Flexible Credit Lines: Bridge cash flow gaps caused by delayed client payments, ensuring your business always has the resources to operate and invest in growth.

• Smoothing Out Payments: Numarqe's extended payment terms can help manage the timing of outflows, ensuring alignment with incoming client payments.

• Expense Management Tools: Track employee expenses efficiently, set limits and controls on spending, and simplify reporting.

• Integration: Sync your financial data with leading accounting software to increase accuracy. This allows for a smooth flow of error-free financial data and simplifies reporting, creating a unified view of your company's finances and improving accuracy and efficiency.

• Customisable Controls: Tailor the platform to meet your specific needs, ensuring you have full control over your spending with granularity and in real-time.

Key Features & Cash Flow Benefits

Multi-Currency Corporate Cards:

• Benefit: Reduces foreign exchange (FX) costs, especially for businesses operating internationally. This directly improves cash flow by minimising unnecessary fees and optimising transaction values.

• How it works: Numarqe provides cards issued in GBP, EUR, and USD. These cards allow payments and withdrawals in local currencies and allow you to repay in your preferred functional currency.

Flexible Credit Lines:

• Benefit: Alleviates cash flow pressures, particularly during seasonal fluctuations or when pursuing growth initiatives.

• How it works: Numarqe's AI-powered underwriting process considers a business's overall financial profile, not just historical data, often unlocking 10x  higher credit limits than traditional providers.

Expense Management Tools:

• Benefit: Streamlining expense management reduces administrative burdens and can uncover areas of wasteful spending, leading to cost savings and improved cash flow.

• How it works: Features like virtual and physical cards, customisable spending limits, and receipt capture empower employees while giving managers superior oversight.

Seamless Accounting Integrations:

• Benefit: Reduces manual reconciliation, improves accuracy, and saves countless hours. This translates to a more efficient finance team and better visibility into cash flow.

• How it works: Bi-directional integrations with platforms like Xero, Sage, NetSuite, and Microsoft Dynamics ensure real-time data exchange.

Security and Control Features:

• Benefit: Safeguards your finances and minimises the risk of fraud, protecting your company's financial well-being.

• How it works: PCI DSS compliance, multiple levels of authorisation, and virtual cards for secure online transactions provide peace of mind.

Making the Transition

Embracing automation might seem daunting initially, but the potential benefits far outweigh the investment. When choosing a solution, it's crucial to select a provider, like Numarqe, that understands the challenges faced by mid-market companies and offers flexibility and customisation to align with your unique workflows.

Could Numarqe be your Cash Flow Super Power?

Numarqe offers recruitment firms the financial agility and insights they need to thrive in a competitive market. By optimising cash flow and empowering you to make data-driven decisions, Numarqe acts as a true partner in your firm's growth and success.

Don't just take our word for it – explore how NUMARQE  can revolutionise your cash flow management and unlock the full potential of your recruitment business.

Book a call today and unlock the potential for sustainable success and new growth opportunities

Measuring Impact: A Crucial Factor in Recruiting

In today's competitive landscape, finding and retaining top talent remains a significant challenge for businesses. Reports from Manpower Group indicate that 75% of employers struggle to fill positions, a sentiment echoed in the 2023 Gartner CEO and Senior Business Executive Survey, which underscores the importance of Growth, Technology, and Talent for CEOs and CFOs.

However, despite the critical role talent plays in organisational success, hiring decisions are often made without sufficient data. It's time to rethink recruitment practices.

Reimagining Recruitment: Beyond Cultural Fit

Many organisations talk about hiring for the right 'cultural fit,' but this approach can inadvertently lead to homogeneity and stifle diversity of thought. Instead of focusing solely on expertise, experience, and personality, there's a need to measure a candidate's impact - their ability to make a positive difference.

Enter The GC Index, a tool that assesses individuals' propensity to create impact. By uncovering hidden talents and natural inclinations, it provides insights beyond traditional metrics.

For Business and Recruitment Leaders The GC Index offers a valuable framework to align people's impact with organisational objectives.

The Five Proclivities of Impact

The GC Index identifies five key ways individuals can make an impact:

1. Strategists: mapping the future

2. Game Changers: transforming the future

3. Implementers: building the future

4. Play Makers: orchestrating the future

5. Polishers: creating a future to be proud of

6. By answering 59 questions, candidates reveal their proclivities, enabling organisations to build well-balanced teams.

Enhancing Team Dynamics

Using the GC Index, organisations can assess team compositions and identify areas for improvement. For example, if a team lacks Implementers, they can strategically hire individuals suited for the role, thereby optimising performance.

Driving Diversity and Inclusion

By removing unconscious biases from the hiring process, the GC Index promotes inclusivity, resulting in a workforce that reflects diverse perspectives. This inclusive culture contributes to enhanced performance and innovation.

Impact Across Industries

From leading brands like Nike and Dyson to public sector organisations and charities, the GC Index is making waves across industries. Its holistic approach to recruitment and team dynamics resonates with organisations of all sizes.

Conclusion

The GC Index represents a paradigm shift in recruitment, focusing on the impact individuals can make rather than fitting a predetermined mould. By championing this tool, Recruitment professionals are redefining their role as strategic partners in organisational success. In a world where people decisions are central to performance, embracing tools like the GC Index is key to making a lasting impact.

 Click here to take the GC Index today!

The importance of business insurance for PSC contractors

Picture this: you are a successful Personal Services Company (PSC) contractor, but just when you think you have everything under control, a letter arrives from HMRC notifying you of an IR35 enquiry. Do you have the time and experience to fight your corner?

From managing tight deadlines to handling complex projects, contractors face plenty of daily challenges, and you can’t always plan for unforeseen events. In our experience, protecting your hard-earned gains with insurance isn’t a choice — it’s an absolute necessity!

In this blog, we highlight the importance of considering the range of business insurances available for PSC contractors. Whatever the world throws at you, enjoy the peace of mind that comes with knowing that you have everything covered.

Why is business insurance important for PSC contractors?

HMRC introduced the private sector IR35 reforms, also known as off-payroll working rules, back in April 2021. To be deemed as working outside of the IR35 rules, contractors must operate as a genuine business. This involves paying themselves a salary and taking any remaining income as dividends, while also handling all the tax affairs.

However, not all contractors operating through a PSC fully understand their new responsibilities. There is an element of financial risk when working outside IR35, so purchasing professional indemnity insurance shows an understanding of the financial obligation and responsibility to protect your interests.

Most companies that hire contractors will also insist on them having adequate professional indemnity and public liability cover. In short, being insured is sound business practice and shows potential customers that you take responsibility for your work and are protected if the worst happens.

Proof of insurance is also vital for recruiters who need contractors to be ready to start as soon as a job lands on their desk. They can inform the client that the contractor can start work immediately as they know that all the employment status and right-to-work checks are in place.

Can business insurance demonstrate your IR35 status?

When HMRC comes knocking on their door, PSC contractors need to show that they are providing services as a business and not as an employee. Employees do not require public liability insurance as they are covered by their employer.

While holding suitable business insurance has little or no impact on the status of a worker, it is an indication that the contractor has taken steps to protect themselves from contractual risks and liabilities.

What types of insurance do PSC contractors require?

There are various types of business insurance available on the market, and the exact policy required will depend upon the type of work being undertaken by the contractor. Read on to learn about the most common policies and why contractors need them.

Professional indemnity insurance: Independent contractors appreciate the freedom and flexibility that comes with working for themselves. However, this autonomy also exposes them to certain risks. In the event that a contractor is accused of negligence, such as offering poor advice, making errors, infringing on copyright, violating confidentiality, or engaging in defamation, professional indemnity insurance can provide protection.

Public liability insurance: Contractors often work on-the-go, such as at a client’s location or on-site, and may even travel internationally. Public liability insurance provides protection if someone is injured or their property is damaged due to the actions of the contractor or their limited company. This coverage includes damages, legal expenses, fees and other costs necessary to remedy the situation. Public liability claims can be expensive, and a client may shift the liability onto you, so recruiters and contractors need to be covered.

Employers’ liability insurance: For certain businesses, employers’ liability (EL) insurance is mandatory. Coverage can provide protection for employees in case they sustain injuries while working. Contractors who have employees, apprentices, or even family members assisting them with their work must have this insurance in place.

Directors’ and officers’ liability insurance: It is worth remembering that PSC contractors can be held responsible for any legal violations or offences related to their business. This includes being personally liable for claims made by regulators, clients, employees, or HMRC for violations such as health and safety breaches or financial mismanagement. Insurance offers protection from these risks.

Personal accident cover: In our experience, this is the most commonly claimed against policy. It acts as a safety net for contractors who suffer injuries while working as self-employed individuals, providing them with a weekly income of up to £500 during their recovery period. Additionally, in the unfortunate event of permanent disability or death as a result of a work-related accident, a lump sum will also be paid out.

IR35 protect insurance: Recent changes to IR35 legislation have caused contractors, end-clients and recruiters to seek extra protection for “outside” engagements. While it does not replace good compliance, IR35 insurance can help reduce the risk and protect everyone in the contractor supply chain in the event of an HMRC investigation. This policy offers legal advice and covers any taxes, interest and penalties related to IR35 investigations. It can also be adjusted to cover whoever HMRC decides is responsible for violating off-payroll working regulations.

Do you have a question about business insurance?

Many policies are mandatory, so we strongly recommend contractors and recruiters regularly review their business insurance cover. End-clients can shift a large portion of liability to contractors, so adequate insurance is an effective method to reduce risk.

Whatever your next job brings, ensure your business and your contractors are protected with a Kingsbridge insurance package. Get all the cover you need in one place, and let us do all the paperwork on your behalf.

Skipton Business Finance - Win a £25 Love2Shop Voucher!

To celebrate the announcement of a new partnership, we’re giving you the chance to win a £25 Love2Shop voucher, by engaging with our LinkedIn post about this exciting partnership.

SBF is thrilled to announce a new partnership with a prominent recruitment agency based in the North of England. This collaboration signifies a strong commitment to supporting the region's thriving construction, engineering, industrial, and commercial sectors.

The recruitment firm plays a crucial role in connecting skilled professionals with exciting opportunities across various industries. Through their expertise, they ensure a smooth and efficient talent acquisition process for businesses in the North.

Fuelling Growth and Bridging the Cashflow Gap

Recognizing the importance of the firm's contribution, SBF is providing them with a £1m Confidential Invoice Discounting facility. This financial solution will empower the agency to bridge cashflow gaps and focus on their core strength – building successful placements for both companies and candidates.

A Win-Win Partnership

This strategic alliance promises to be mutually beneficial. While the firm leverages our financial solution to accelerate their growth, SBF gains a valuable partner dedicated to fostering a skilled workforce within the Northern region.

Looking Forward to a Successful Collaboration

We are confident this partnership will unlock new possibilities and contribute significantly to the continued success of the Northern Powerhouse.

Join the Conversation and Win!

To celebrate this exciting partnership, we're hosting a giveaway on our LinkedIn page! Follow us and like our post about this deal for a chance to win a £25 Love2Shop voucher. Don't miss out – head over to our LinkedIn page now!

Is Your Recruitment Agency Losing Top Talent Due to Payroll Headaches?

Did you know that 33% of businesses make payroll mistakes annually? 
Source: (NPA World Wide)

This statistic should be a red flag for recruitment agencies, as timely and accurate pay is not just a matter of employee satisfaction, but also a key factor in retaining top talent. Payroll processing challenges can lead to frustrated workers and high turnover, potentially costing your agency valuable resources.

At IMS Decimal, we understand the unique payroll needs of recruitment agencies. We offer expertise in streamlining and managing your payroll process, ensuring your employees are paid accurately and on time every time.

Payroll Nightmare Solved! Discover the Fix Here 

Click here to book a meeting with our experts to start experiencing the benefits of our streamlined payroll services. 

The Cashflow Advantage: Attracting Top Talent with Early Payments via Invoice Finance

In today's competitive talent market, attracting and retaining top performers is crucial for recruitment agencies. However, traditional payment cycles can put your firm at a disadvantage. Candidates often face waiting periods to receive their placement fees, impacting their cash flow and potentially swaying them towards faster-paying competitors.

This is where Invoice Finance can be a game-changer. By leveraging Invoice Finance, recruitment agencies can offer early payments to successful candidates, even before client invoices are settled. This strategy presents a significant competitive advantage in attracting highly qualified personnel.

Benefits of early payments for candidates:

• Improved Cashflow: Early payments alleviate any financial burdens candidates might face while waiting for traditional payments. This can be particularly attractive for independent contractors or those with immediate financial needs.

• Increased Financial Security: Knowing they'll receive payment promptly fosters a sense of security and trust with your agency.

• Competitive Edge: Candidates appreciate the financial flexibility and peace of mind that early payments offer, making your agency a more attractive employer.
  

Invoice Finance: The enabler of early payments

Invoice Finance bridges the gap between placing a candidate and receiving client payment. Here's how it works:

1. Placement and Invoice: Your agency successfully places a candidate and sends an invoice to the client for the placement fee.

2. Financing the Invoice: You partner with an Invoice Finance company. They advance a significant portion (up to 100%) of the invoice value upfront.

3. Early Payment to Candidate: You use the advanced funds to make an early payment to the candidate.

4. Client Payment: Once your client settles the invoice with the Invoice Financier, you receive the remaining balance, minus a financing fee.
   

Competitive advantage beyond cashflow

Early payments through Invoice finance offer additional benefits:

• Enhanced Employer Brand: Your agency gains a reputation for being financially responsible and candidate-centric.

• Faster Candidate Onboarding: Streamlined payments eliminate delays in candidate onboarding, allowing them to start contributing sooner.

• Increased Candidate Satisfaction: Early payments foster a positive candidate experience, potentially leading to repeat business and referrals.

Implementing early payments with Invoice Finance

To integrate early payments into your recruitment strategy:

• Evaluate Invoice Financing Options: Research Invoice Finance companies to find one with competitive rates and terms.

• Assess Cash Flow Needs: Determine the percentage of candidate fees you'd like to pay upfront to manage your cashflow effectively.

• Communicate the Advantage: Clearly communicate the early payment option to candidates during the recruitment process.

In a competitive talent market, offering early payments can make a world of difference. By leveraging Invoice Finance, your recruitment agency can unlock this strategic advantage, attracting top talent, improving candidate satisfaction, and ultimately driving your business forward.

Get in touch with one of our team to find out more:

Matthew Shepherd – Chief Operating Officer – mshepherd@skiptonbf.co.uk

Ian Keevil-Smith – Sales Director (South) – ikeevil-smith@skiptonbf.co.uk

Phil McLeod – Regional Sales Director – pmcleod@skiptonbf.co.uk

Recruitment Firms Embrace Financial Efficiency with Virtual Credit Cards: A Numarqe Adventure

Step into the world of financial management with Numarqe, where innovation meets user-friendliness in a delightful blend. It's time to bid farewell to conventional financial practices and welcome the efficiency of virtual credit card transactions. Numarqe isn't just a credit platform; it's your business's trusted companion, here to transform how you handle finances with elegance and charm.

Understanding Virtual Credit Cards

Imagine, if you will, a world where each payment is as smooth as the first sip of your morning coffee, and worries about security are a thing of the past. Enter virtual credit cards – the digital marvels that make this world a reality. These cards are tailor-made for specific transactions and can be deactivated in one click, leaving fraudsters scratching their heads. Not only are virtual credit cards secure, and give you full control of your spending.
Have a rogue marketing campaign that is constantly charging your card? Simply turn them off! 

Virtual credit cards also lighten the load on your wallet physically (Apple and Google wallets supported) and financially by reducing the costs associated with physical cards. The best part? They empower you to take control of your spending with customisable limits and real-time tracking. 

Streamlining Financial Operations

Virtual credit cards are the secret ingredient to effortlessly navigating your financial operations. They excel in making payments smooth, automating tedious reconciliation tasks, and cutting down the time spent on administrative tasks. Imagine freeing your team from the monotony of chasing paper receipts and deciphering paper statements, allowing them to concentrate on what truly matters – expanding your business. With virtual credit cards, this vision becomes a reality as they seamlessly integrate into your existing accounting systems and ledger coding. For example, create a Marketing card specific for marketing spend, and assign a Tech Stack credit card to manage all your IT, Software and Services spending. These cards can be reassigned to different people or disposed of and recreated as many times as you like. 

Cracking the Code to Financial Oversight

Through Numarqe's dashboard, you aren't just observing your finances; you're unravelling their mysteries. This is where virtual credit cards shine, providing a crystal-clear view of your company’s expenditure. It's akin to having a financial detective by your side, aiding you in making informed decisions, identifying savings opportunities, and keeping your budget in check. Real-time insights ensure that you're always a step ahead in understanding your cost base across every department, guiding your business with confidence.

Mastering Cash Flow With Ease

Managing cash flow can often feel like a balancing act, but virtual credit cards are here to transform it into a leisurely stroll in the park. With the advantage of flexible and extended repayment terms, virtual credit cards become your trump card in maintaining fluid finances. Use them to spend today on corporate essentials and repay your balance later, thereby effortlessly optimising your cash flow balance across your working capital cycle. Say goodbye to cash shortages and hello to a streamlined, stress-free approach to managing your finances.

Real Success Stories

Let the success stories speak for themselves. Businesses of all sizes have witnessed a surge in financial efficiency with virtual credit cards, revelling in the benefits of streamlined operations, enhanced oversight, and optimised cash flow. These aren't just success stories; they are invitations to join the league of financially astute businesses. See how Proco has created operational efficiency across their teams to support them in their growth journey.  

Conclusion

Numarqe isn't merely offering virtual credit card solutions; it's ushering in a revolution in financial efficiency. As we've explored the myriad benefits – from security to oversight, cash flow management to operational streamlining. Are you ready to elevate your business's financial management? Let Numarqe lead the way, book a call with us and find out more.

New rules to offset the risk of using off-payroll workers from 6 April 2024

We will shortly be approaching the third anniversary of the extension of the revised off-payroll worker (IR35) administrative rules to medium-sized and large private businesses. Following an announcement in the 2023 Autumn Statement, a new offset mechanism is set to be introduced from April 2024 that will reduce the potential liabilities for engagers and/or fee payers using workers operating via intermediary entities, such as personal service companies (PSCs), where HMRC disagrees with a worker’s status determination the engager makes. Potentially, the new rules will make it more attractive for businesses to use the services of off-payroll workers operating via such intermediaries.

What’s the issue?

Under current rules, if a medium-sized or large business or public sector entity uses an off-payroll worker operating through an intermediary and HMRC disagrees with the status assessment, the engager or fee payer is responsible for all income tax and National Insurance contributions (NICs) due under PAYE in respect of the engagement, together with interest and possibly penalties, potentially back to 6 April 2017 in the case of public sector entities. There is no provision for offset of any income tax or corporation tax paid by the worker or their intermediary. The worker or intermediary is, however, in theory able to seek a repayment from HMRC for themselves.

As a consequence, many risk-averse businesses have made blanket decisions to not use the services of workers operating off-payroll via intermediaries such as PSCs. Many commentators also believe that where the engager is a public sector entity and gets the status assessment wrong, the current rules, with no provision for set off, are inequitable as all the risk and liability is borne out of public funds.

The current rules also create an un-level playing field in that there is already an offset mechanism in place for engagers, subject to HMRC agreement, where a sole trader is treated by the engager as self-employed but HMRC determines that the status assessment is incorrect. 

The proposal

Following the Autumn Statement announcement, draft legislation has now been published with the intention of introducing an offset mechanism for engagers and fee payers where HMRC disagrees with a status assessment involving the engagement of a worker through an intermediary. This will mean a broad alignment with the existing set off rule for sole traders but there will be important differences.

It is intended that the new rules will operate where a ‘trigger event’ occurs on or after 6 April 2024, and will apply to payments made from 6 April 2017 by public sector entities and from 6 April 2021 by medium-sized or large private sector entities. For these purposes, trigger events include situations where HMRC serves notice of a determination or receives a trigger letter of offer in relation to tax due on a payment under an off-payroll working engagement.

The mechanics of the set off 

The proposed legislation will enable HMRC to set off amounts of tax (including income tax, employee NICs and corporation tax) already paid by a worker or their intermediary on income arising from the particular engagement, against a PAYE liability of the engager that is found to have made an incorrect status assessment (or that has not made any status assessment at all) or the fee payer. It should be noted though that the legislation only permits set off of income tax and employee NICs. The engager or fee payer will still be responsible for arrears of employer NICs and, where due, apprenticeship levy.

HMRC has stated that where it is able to establish the income tax and employee NICs that have been paid on the particular income, an offset calculation based on actual figures will be used. Where it can only be established that some income tax and employee NICs have been paid by the worker or intermediary on that income, HMRC will make a best estimate of the amount to be set off based on the information available. There is no prescribed formula for this best estimate, and it remains to be seen how HMRC will ensure that a consistent approach is taken.

Summary

Whilst the proposals are generally welcome, as they will reduce the financial burden and risk for public sector and medium-sized and large private sector entities that get their status assessments wrong, workers who provide their services through intermediaries such as PSCs need to be aware of the consequences of the change.

Businesses using the services of off-payroll workers operating through intermediaries should review their policy and approach to the engagement of such workers in light of the proposed change. In particular, to ensure that HMRC has the necessary information to consider set off, engagers should, as a minimum, maintain details of:

• workers’ full names and National Insurance numbers; and

• full names of the workers’ intermediary entities and, as relevant, their company or partnership reference numbers or VAT registration numbers.

Finally, any business that has an open enquiry in relation to the status of an off-payroll worker operating via an intermediary needs to be mindful that the set off provisions will only apply to a ‘trigger event’ on or after 6 April 2024. Where a status assessment case is finalised before this date, no set off will be available and HMRC has confirmed that it will not reopen cases.

For more information, please get in touch with David Williams-Richardson, or your usual RSM contact.

Navigating Financial Waters: Our Guide to Crafting an Airtight T&E Policy

Understanding T&E:

Let's start by unravelling the essence of T&E – a significant expenditure for businesses involving travel and expense costs. These expenses, encompassing everything from business trips to client meetings, demand a strategic approach to ensure prudent financial management.

When drafting a T&E policy, it is important to conduct a thorough assessment of your company’s requirements when it comes to travel and expenses. Consider the nature of your business, the frequency of travel, and the specific needs of your employees. Identify key stakeholders, such as finance, human resources, and department heads, to gather insights and ensure a holistic approach.

The T&E Policy Blueprint:

To ensure financial prudence, we advocate for the creation of a robust T&E policy. This document serves as a set of guidelines for employees, delineating eligible travel expenses and the procedures for reporting and approval.

Let us break down the essential components of an effective T&E policy:

Reimbursement Procedure:

Document what is an expense that can be reimbursed or should be charged directly on a company card. Specify the timeline for processing reimbursements and the method of disbursement. Clear expectations and timely payments contribute to financial transparency.

Define Your Policy’s Objective:

Clearly outline the objectives of your T&E policy. These may include controlling costs, ensuring compliance with tax regulations, promoting employee safety, and fostering responsible spending. Understanding the overarching goals will guide the development of specific policies within the document. When objectives aren’t clearly set out, it can cause more confusion and can create more admin.

Expense Categories:

Distinguish and explain various eligible expense categories, including transportation, lodging, meals, and entertainment. Providing clear definitions helps prevent excessive spending and ensures clarity for our staff.

Approval Process:

Detail the process for submitting expenses, including required forms and supporting documentation. An automated approval system, powered by financial platforms like Numarqe, ensures efficiency in tracking and approvals.

T&E Policy Best Practices:

1.     Consult with Management and the Wider Team:

Working with different teams will ensure that a best practice T&E policy is correctly implemented. By involving different teams such as HR, legal, finance team and compliance teams will create a foundation that will align with existing company policies.

2.     Benchmark T&E Costs:

Reviewing T&E costs and comparing those across different locations within your business will provide insight into reasonable and expected costs across different geographies, budgets and expense categories.

3.     Review Tax Implications:

Address issues such as tax implications for employees, compliance with local laws, and any industry-specific regulations. Regularly review and update your policy to stay current with changing regulations. See third party advice if necessary to provide further comfort that your policies don’t have a negative tax implication.

4.     Optimise for Tax Deductions:

Align the policy with HMRC guidelines to ensure tax-deductible expenses. Check out the HMRC guidelines for expenses and reimbursements here.

Here are some insights for a smooth T&E policy implementation:

1.     Create a Communication Plan: Disseminate the policy through management announcements i.e. emails, or other channels to ensure awareness. Conduct training sessions or provide written materials to ensure that everyone understands the guidelines and procedures. Regularly update employees on any policy changes and make the information easily accessible.

2.     Speak To Employees and Collect Feedback Early: Gather feedback early in the implementation process to identify areas for improvement and ensure adherence to procedures.

3.     Introduce Company Cards: Simultaneously implementing corporate cards streamlines the process, offering control over spending and category limits.

4.     Evolve and Improve: Encourage feedback from employees who regularly travel or incur expenses. Use their input to identify areas for improvement and adjust the policy accordingly. A T&E policy is a dynamic document that should evolve with the changing needs and dynamics of your organisation.

How to streamline with Numarqe:

We introduce Numarqe's corporate cards and working capital platform as the ultimate tool to streamline T&E expenses. We can empower employees with their own Numarqe cards and ensure duty of care with visibility into every employee's trip.

Uncover Hidden Potential: How a Finance Health Check can help your recruitment firm attract top talent

The recruitment industry thrives on dynamism, but navigating complex financial landscapes can be challenging. At Skipton Business Finance, we understand the unique needs of recruitment agencies. That's why we’re offering a no obligation finance facility health check.

Why a Health Check matters

A health check provides a comprehensive overview of your current financial setup. We'll analyse existing loans, credit lines, and Invoice Finance arrangements. This assessment helps you:

• Identify potential areas for improvement: Are there ways to optimise your current financing options? Can you leverage more than you’re currently getting?

• Uncover cost-saving opportunities: Could you be paying less for your existing financial products? Can we help you get a better deal with your current provider?

• Gain a clearer picture of your financial health: How well-positioned are you for future growth initiatives?

• Negotiate Better Rates or Find Alternatives: We can help you secure better rates on your current financing or point you in the right direction for alternative providers if SBF cannot help.

Financial Fitness: The key to client success

A financial health check goes beyond standard bookkeeping. It's a comprehensive analysis of your current financial setup, including loans, credit lines, and invoice financing arrangements. This assessment unlocks opportunities to optimise your finances and free up resources crucial for delivering exceptional recruitment services to your clients. Here's how:

• Enhanced Service Offerings: Does your current financial situation limit your ability to invest in cutting-edge recruitment technologies or upskill your team? The health check might reveal opportunities for securing funding, allowing you to offer your clients a wider range of advanced recruitment solutions and attract more business.

• Improved Client Satisfaction: Clients often seek recruitment providers with proven success rates and a deep talent pool. A healthy financial profile demonstrates your ability to invest in attracting high-calibre candidates, leading to a higher success rate for client placements and improved client satisfaction.

• Project Financial Stability: Build Trust and Confidence: Clients want to partner with reliable and financially stable providers. A healthy financial check-up showcases your capacity to handle fluctuations in the recruitment market and deliver consistent, high-quality services, building trust and confidence in your services.

• Confident Investment Decisions: Expansion opportunities or new technology adoption might require strategic investments. The health check provides a clear picture of your financial standing, allowing you to make confident investment decisions that enhance your client service capabilities.

Don't let financial limitations hinder your ability to serve clients effectively. Schedule your free finance facility health check with Skipton Business Finance today. Take control of your finances, unlock resources for service expansion, and watch your recruitment business flourish.

Get in touch with one of our team to find out more:

Matthew Shepherd – Chief Operating Officer – mshepherd@skiptonbf.co.uk

Ian Keevil-Smith – Sales Director (South) – ikeevil-smith@skiptonbf.co.uk

Phil McLeod – Regional Sales Director – pmcleod@skiptonbf.co.uk

5 Common Invoice Finance Myths Debunked: A Guide for Recruitment Businesses by Skipton Business Finance

At Skipton Business Finance, we understand the cash flow challenges faced by recruitment agencies.  Placing talented candidates is only half the battle; you also need to wait for client payments, which can create a gap that hinders your ability to grow. Invoice Finance can bridge this gap by providing an advance on your outstanding invoices, but some misconceptions might be holding you back.

Let's debunk five common myths and set the record straight for recruitment businesses:

Myth #1: Invoice Finance is only for struggling businesses

This is a misconception we hear often. Invoice Finance is a strategic tool for all recruitment agencies, regardless of their financial standing. It's a way to optimise cash flow, not a sign of trouble. Whether you're looking to scale your operations, invest in marketing, or simply gain peace of mind, Invoice Finance can be a powerful driver of growth.

Myth #2: Invoice Finance is expensive and opaque

There are costs associated with Invoice Finance, but at Skipton Business Finance, we offer transparent fee structures. You'll know exactly what you're paying for upfront, with no hidden charges. We also leverage technology to provide you with real-time data and clear breakdowns of fees, so you're always in control.

Myth #3: Invoice Finance damages customer relationships

In fact, Invoice Finance can sometimes strengthen client relationships. By offering flexible payment terms to your clients, you become a more attractive partner. Additionally, some Invoice Finance models, like Confidential Invoice Discounting, allow you to keep your client completely unaware of the financing arrangement.

Myth #4: You lose control of your invoice

With an Invoice Finance facility with Skipton Business Finance, you remain the owner of your invoices, and we work collaboratively with you throughout the process. You'll have access to our secure online portal to track your invoices and receive updates on collections.

Myth #5: Invoice Finance takes too long to set up

The application process for Invoice Finance is designed to be much quicker than traditional loans. At Skipton Business Finance, we offer streamlined online applications and fast approvals, allowing you to access funding quickly and efficiently.

Don't let these myths hold you back from exploring the potential of Invoice Finance. By understanding the truth, you can make an informed decision about whether it's the right fit for your recruitment business. Here at Skipton Business Finance, we are dedicated to helping recruitment agencies thrive. Our team of Invoice Finance specialists has extensive experience in the recruitment industry and understands your unique needs. We will work closely with you to develop a customised Invoice Finance solution that fits your specific requirements and helps you achieve your business objectives.

Contact Skipton Business Finance today to discuss how Invoice Finance can help you achieve your financial goals and take your recruitment business to the next level.

Beyond the Numbers: Why Client Care Matters in Choosing an Invoice Finance Provider

For recruitment businesses, navigating cashflow can be challenging, especially when dealing with slow-paying clients. Invoice Finance offers a solution by unlocking working capital tied up in outstanding invoices. However, with multiple providers vying for your business, choosing the right one goes beyond just competitive rates and advance percentages. Client care emerges as a significant factor often overlooked but crucial for a smooth and successful partnership.

Here's why prioritising client care should be paramount when selecting an Invoice Finance provider specifically for recruitment agencies:

1. Understanding the Recruitment Industry:

The recruitment industry operates in a dynamic and competitive environment. Recruiters deal with diverse clients, candidates, and placement complexities. A generic lending approach won't suffice. A provider with dedicated client care and extensive knowledge of the recruitment industry will ensure that your facility meets your unique needs and challenges. They can tailor solutions like flexible funding options, specialised industry knowledge, and support in navigating recruitment-specific regulations.

For instance, a recruiter placing a high-value candidate might require an immediate advance on a significant invoice. An understanding provider can accommodate this need without rigid one-size-fits-all policies.

2. Building Trust and Long-Term Relationships:

Recruitment relies heavily on building trust with clients and candidates. Choosing an Invoice Finance provider that prioritises client care fosters a similar collaborative relationship. A dedicated funder who goes beyond basic transactions become trusted advisors by offering:

Proactive communication: Regular updates on your account status and ongoing support throughout your experience.

Transparency: Clear and upfront communication on fees, terms, and any potential risks associated with the funding process.

Responsiveness: Prompt and efficient handling of inquiries and concerns, ensuring your needs are addressed swiftly.

This builds trust and strengthens the partnership, allowing you to focus on core business activities while the provider seamlessly handles your funding needs.

3. Streamlining the Funding Process:

The recruitment process itself can be time-consuming. Choosing an Invoice Finance provider with efficient client care can significantly simplify and expedite the funding process. Look for a provider that offers:

Easy-to-use online platforms: Streamlined applications, invoice submissions, and real-time account management capabilities.

Dedicated support: A dedicated point of contact for any technical or process-related questions, avoiding delays and frustrations.

Flexibility: Tailored solutions and a willingness to work around specific recruitment workflows to ensure minimal disruption.

By prioritising client care, the provider demonstrates a commitment to making your life easier and facilitating a smooth funding experience.

4. Supporting Growth and Adaptability:

The recruitment industry is constantly evolving. A provider with strong client care actively supports your business growth by:

Offering guidance and resources: Sharing industry insights, market trends, and potential funding options tailored to your growth goals.

Adapting to your changing needs: As your business evolves, your provider should be willing to adjust funding structures and support your changing requirements.

Providing expertise beyond just finance: Many providers offer valuable advice on recruitment best practices, credit control strategies, and other industry-specific insights.

This ongoing support ensures your financial partner remains a valuable resource throughout your recruitment journey.

5. Mitigating Challenges and Risks:

Recruitment can be unpredictable, and challenges can arise unexpectedly. A provider prioritising client care becomes a partner in navigating these challenges by:

Offering proactive risk assessments: Identifying potential issues in the recruitment process and suggesting solutions to mitigate financial risks.

Proactive communication in case of delays: Informing you of any potential delays in payment collections and working collaboratively to find solutions.

Offering additional support: Sharing industry resources or connecting you with relevant experts to help overcome unforeseen challenges.

This proactive approach demonstrates the provider's commitment to your success, not just their own profit.

Choosing the right Invoice Finance provider for your recruitment business requires a holistic approach. While competitive rates and terms are crucial, prioritising client care offers significant benefits beyond the initial numbers. By building trust, streamlining processes, fostering growth, and supporting you through challenges, a client-centric provider becomes a valuable partner in your long-term success. In a dynamic industry like recruitment, a strong partnership built on genuine client care can be the key to unlocking your full potential.

While numerous providers offer Invoice Finance solutions, we believe that Skipton Business Finance stands out for its unwavering commitment to client care. SBF boasts dedicated Relationship Managers with extensive recruitment industry expertise. These individuals go beyond transactional interactions, becoming trusted advisors who understand your specific needs and challenges.

Statement of Work, Insurance and IR35

How Kingsbridge can support businesses looking to offer services under a genuine statement of work (‘SOW’).

Recruitment companies are highly experienced in providing skills and people. Some have also been exploring the opportunity of providing what HMRC refers to as ‘contracted out services’ to their end-user clients. This means changing their business model from delivering traditional recruitment services (i.e., an individual) to becoming a ‘service provider’.

This will inevitably increase their business and financial risk exposure as they become responsible for deliverables and project outcomes. These services have different insurance requirements, too, which often lead to higher premiums. Additionally, there are other important considerations such as the off-payroll rules and whether ‘contracted out services’ fall outside of the legislation.

Business insurance requirements

When a business is looking to offer services to their clients under an SOW, they need to consider a new policy to cover these works – one where the definition within the SOW matches the definition on the insurance schedule (e.g., IT Consultant). In an SOW, it’s highly likely a recruiter will no longer be defined as an ‘employment agency’, but as a contractor or consultant.
They will however still be described as an ‘employment agency’ on their insurance business description, so are effectively uninsured for the SOW work. In which case, the best bet is to seek alternative professional indemnity combined cover or endorse their recruiter policy to include the SOW work. Professional indemnity, public liability, and employers’ liability are the essentials, but additional cover may be needed if there are contractual liability requirements around tax deductions, IP, or data protection

It's also worth noting that there’s a significant increase in risk exposure when offering services under an SOW as opposed to standard recruitment practices. Therefore, there must be an adequate level of protection in place. For businesses receiving services under an SOW, checking the service provider’s insurance cover and levels should be a factor when carrying out due-diligence checks.

Contractor insurance requirements

All organisations need to ensure they have the appropriate insurance in place as a business, but they also need to ensure that individual contractors working through a personal service company (‘PSC’) are covered.

Under an SOW, it’s highly likely that the service provider will be signing up to contractual obligations and taking responsibility for both the quality of the work and the outcomes. That means they would be the party who would be sued for any poor services or failures to deliver. An SOW makes undeniable responsibilities that have to be fulfilled, and it’s easily identifiable and trackable when there has been such a failure.

Service providers will be in a better position if the engagement carries genuine business and financial risk – including holding back payments pending satisfactory performance sign-off or rectification. It is because of this high exposure that most service providers pass the responsibility and risk to the individual contractor where appropriate, ensuring any additional reworks are undertaken at the contractor’s cost. This makes it even more important for any contractors providing services under an SOW to have adequate insurances in place.

IR35 considerations

The off-payroll working reforms placed a responsibility on end-hirers to determine the IR35 status of their PSC contractors. However, where the services are fully contracted out to a third party, that third party will become responsible for determining IR35 status. Therefore, if a company outsources work via a genuine SOW, the responsibility for determining IR35 status and ensuring the appropriate amount of tax is deducted will rest with the provider of the services not the end-hirer.

This was confirmed in a reference that HMRC made in their ESM10010 employment status manual. The manual confirms that the person who receives the fully contracted-out service does not need to apply the off-payroll working legislation, as they will be “the highest person in the chain” and will have no obligations under the new rules in relation to that contract. It is the service provider offering the fully contracted-out service who must consider if it’s within scope of the off-payroll working rules.

If this model is used correctly and the services are genuinely outsourced, it can relieve the burden of determining IR35 status for the ultimate engager – making it an attractive option for end users. An SOW can also become more cost-effective when scoped out and contracted correctly, as it can avoid significant cost increases or resource changes. It’s extremely important for services supplied under an SOW to be genuine, which means the end user needs to be able to totally turn over control to the service provider and accept anyone (not one specific contractor) to deliver the services.

Unlocking Business Potential: 10 reasons to implement a Corporate Credit Card Program

Unlock Financial Flexibility & Growth with NUMARQE Corporate Credit for Recruiters

In the fast-paced world of recruitment, financial agility and efficient expense management are not just advantages — they are necessities.

The NUMARQE Corporate Credit Card Program is a transformative solution designed to propel recruitment firms into a new era of financial empowerment and operational excellence.

Here’s 10 reasons why embracing our Corporate Credit Card Program is a strategic move for every ambitious recruitment firm:

1. Immediate Access to Unsecured Capital: Tailored for dynamic businesses like recruitment firms, NUMARQE cards offer substantial unsecured credit lines, ensuring you have the financial flexibility to seize growth opportunities without tapping into your working capital. This is crucial for managing seasonal fluctuations and supporting business expansion with ease.
   

2. Agile Business Scaling: With instant funding for various business needs—from technology upgrades to office supplies—your firm can swiftly respond to market demands, ensuring you're always a step ahead in the competitive recruitment landscape.
   

3. Seamless Financial Synchronisation: Our digital platform integrates directly with your accounting software, reducing manual data entry and providing real-time insights into your spending. This synchronisation enhances cash flow management and financial forecasting, allowing you to focus on strategic growth rather than clerical tasks.
   

4. Efficient Online Procurement: Simplify the procurement process with our corporate credit cards, making online payments and international transactions smoother than ever. This efficiency is vital for recruitment firms that rely on global platforms and services to source top talent.
   

5. Enhanced Spending Controls: Set precise spending limits tailored to your firm's needs, ensuring compliance with your financial policies. Our platform provides unparalleled visibility into your expenditures, enabling proactive management of your financial resources.
   

6. Boosted Employee Satisfaction: Eliminate the hassle of out-of-pocket expenses for your team. Our user-friendly system allows for effortless receipt uploads and provides benefits like universal acceptance and easy card replacement, enhancing the overall employee experience.
   

7. Virtual Cards for Maximum Flexibility: Deploy virtual cards for online purchases or specific types of transactions, offering an added layer of control over your corporate spending. This feature is especially beneficial for managing expenses in a remote work environment, a common scenario in the recruitment industry.
   

8. Currency Risk Mitigation: With cards available in multiple currencies, your team can make purchases in the correct transaction currency, avoiding unnecessary FX conversion costs. This is particularly advantageous for firms with international clients or those that frequently send employees abroad.
   

9. Streamlined Expense Management for Travel & Entertainment: Gain complete control over travel and entertainment expenses with detailed transaction information available at your fingertips. This visibility ensures compliance with spending policies and simplifies the management of these often variable costs.
   

10. Effortless Subscription Management: Keep track of all company subscriptions in one centralised location, from software services to digital advertising. Our platform helps prevent subscription creep, ensuring you only pay for what your firm genuinely needs.

The NUMARQE Corporate Credit Card Program is not just a payment solution; it's a strategic partner in your firm's growth journey. Designed with the unique needs of recruitment firms in mind, it offers a blend of flexibility, control, and efficiency that can transform how you manage your finances.

Don't just take our word for it; let the success stories do the talking. Businesses have seen their financial efficiency soar with Numarqe revelling in the benefits of streamlined operations, enhanced oversight, and optimised cash flow. These aren't just success stories; they're invitations to join the ranks of financially savvy businesses. Take a look at a case study from Proco Consultants.

Ready to elevate your financial operations and focus more on growing your business? Book a demo with us today and discover how the NUMARQE Corporate Credit Card Program can revolutionise your expense management, reduce costs, mitigate risks, and streamline all your payments.

Bad Debt Protection: How BDP alongside your Invoice Finance facility can give you peace of mind

As a business dealing with customers, there’s often a risk that those customers will fail to pay the money owed to you, whether it be a late payment, or worse, a customer going into administration. Losing the money owed to you can have detrimental effects to your business, particularly if it involves key customers. Bad Debt Protection (BDP) is a great option for any business wishing to safeguard against these potential losses.

With Skipton Business Finance, you can access BDP as an add-on service to your existing Invoice Finance facility, which allows you to protect your business against bad debt caused by customers failing to pay.

There are many benefits to having BDP:

It’s secure - you can be protected for up to 95% of the value of an invoice, should your customer fail to pay or go into administration.

It’s fast - in most cases, the Bad Debt Protection limit decision will be within 24 hours.

You can trade with confidence - knowing you’re protected and that you will receive payment for the work you’ve done, or products you’ve sold, allowing you to develop and grow your business in-line with your plans.

You could access increased funding - if BDP is in place on a customer, this often means we can increase that customer’s funding limit in-line with the agreed BDP limit.

It gives you better insight - BDP gives you access to greater customer intelligence that leads to balanced risk decisions. We can help you spot a potential credit risk before it becomes a bad debt. Understanding a customer’s credit risk means that, armed with this knowledge, you can act before they become a bad debt.

You can manage business on your own terms - choose the service that suits your business needs by protecting all of your customers, or just a selection.

Is Bad Debt Protection right for my business?

BDP can provide you with peace of mind if:

·        you want to protect your cashflow

·        you want to grow, knowing your sales ledger is protected

·        you have had one or more previous bad debts

·        you want to mitigate the risk that a small number of

·        customers represent a large percentage of your sales ledger

How much will it cost?

The costs of our BDP depends on each business. We don’t offer a ‘one size fits all’ product and, instead, tailor each facility to the individual requirements of each business. We provide competitive and transparent charges, with the costs being outlined in your facility offer letter, as well as any additional fees.

How does it work?

BDP ensures that you are protected against any bad debt caused by failed customer payments.

Simply put:

1. You can choose to protect the whole of your sales ledger or selected customers.

2. We will confirm a BDP limit for the customers you requested limits on. If we cannot provide a limit, we will confirm the reason why.

3. We can provide up to 95% of the debt outstanding, excluding VAT, as long as the balance exceeds £500.

4. BDP can protect both UK and export customers.

5. It compliments your Invoice Finance facility, with minimal additional administration for you.

Bad Debt Protection alongside your Invoice Finance facility can give you peace of mind, without having to worry about late payments or debt caused by failing customers.

If you’d like to find out more about Bad Debt Protection from SBF, please visit our dedicated BDP page.

Whether you’re new to Invoice Finance, or an existing SBF client who’d like to benefit from SBF, we’re here to help. Enquire today to see how BDP could support your business.

Numarqe - ‘Bank Computer says No’ is strangling recruiters’ ambition.

If the ‘rule of the robots’ from banks ever comes to pass, it will be because we allowed it to, by believing that technology can never be wrong, and that insights and recommendations from a ‘black box’ should always override human decision-making.

If you’ve ever had to deal with an intransigent customer service agent, someone who denies details about yourself or your experience because their software says the opposite, you’ll know what I’m talking about.

The ‘Computer says No’ attitude already pervades so many areas of our lives, but it’s nowhere so prevalent as in the bank decision-making around corporate lending.

Everyone knows business lending is in crisis, with loans to (especially mid-size) enterprises turning into a trickle in recent years, especially to businesses with highly seasonal and often unpredictable cash flow like those in the recruitment sector.

It’s not just the post-credit crunch culture of risk aversion that’s turned off the lending taps to the mid-market. Banks and other legacy credit providers persist in antiquated methodology for assessing lending criteria; they tend to look only at surface-level business metrics and once you fall into those very rigid buckets, it's almost impossible to get out of it. Meanwhile, when recruitment firms can get a loan, the decision (and the amount, and the payment terms) are invariably dictated without any human involvement, and instead by algorithm alone.

This hurts everyone: when lending dries up businesses cannot access the capital they need to invest, grow or pay their bills; as a consequence, liquidity evaporates from the global economy. The results are particularly pernicious when it comes to the recruitment industry, which plays such an important role as an engine of growth and job creation.

Technology: a tool, not a master

The ‘rule of the robots’ is strangling recruitment firms’ growth ambitions. How can we restore fairness to lending and ensure they get the credit they’re entitled to, on the most flexible terms, and available instantly to every employee or department that needs to make business-critical purchases? 

First, remember that technology isn’t an omniscient oracle that must always be obeyed. Artificial intelligence and analytics can provide a wealth of insight to inform lending decisions. But that’s the key word: inform. For all tech’s number-crunching capabilities, there is a range of factors that computers simply can’t or won’t quantify. These include critical, contextual information about businesses’ needs, their repayment capabilities, future market conditions, or the potential ROI of investment.

Moreover, technology loves putting businesses into ‘buckets’ rather than looking at their operations (and ambitions) holistically.

This insight can only be gleaned through a direct, trusted relationship between lenders and the businesses they serve. The question, however, is not the health of the relationship between recruiters and their lenders, but whether there’s a relationship at all. When was the last time you had a proper chat with a dedicated loan manager at your bank who knew your business?

We know people who utilised millions of pounds-worth of credit a year through one of the major global credit card providers, yet still didn’t have a dedicated account manager. (One of them joined our team!)

Restoring fairness through humanity

The financial industry needs urgently to reappraise how it judges recruiters’ (and other businesses’) creditworthiness, and take into account the full spectrum of factors that affect their ability to repay.

That’s only possible by weaving together the best of tech with the all-important human factor. Advances like AI and instantly-issued virtual payment cards offer incredible opportunities to assess individual recruiter’s circumstances, enable them to give selected employees instant credit, and fine-tune lending limits and payment terms in real-time.

Artificial intelligence engines should enable financial services providers to provide dynamic credit, flexing to the working capital cycle of a business and ensuring ultimate flexibility across credit amounts drawn, repayment terms and financing costs. When combined with insight drawn from relationships with our customers’ CFOs and other leaders, we’ve found this hybrid approach opens between three and ten times the amount of credit available from traditional lenders.

If we want to fix the broken lending market and restore fairness, we need a much more sophisticated assessment of risk and reward than tech alone can provide. Ironically, if the traditional financial industry continues to ignore ‘old fashioned’ relationships, they’ll lose market share to the fintechs that combine humans and computers to say “Yes” to their customers.

Nurmarqe is the proud business credit card partner for Recruitment FDs network.