Recruitment companies involved in Contracting or Temporary labour will usually have an anchor on growth as a result of having to pay wages long before the client has paid the invoice for the labour provided.
A signed timesheet is widely regarded as a solid base for a debt and the receivables finance market is always keen to provide funding solutions to cover the time between the employee being paid and payment of the invoice from the client.
Credit Insurance is almost always the third ingredient in this funding circle. The debt may be undisputable, but it is still only as good as the strength of the client company. A properly construed Credit Insurance policy will not only cover a debt after it has been invoiced but will also look at the potential loss which may arise in respect of unsigned timesheets at the point of insolvency, something not always covered by all Debt Protection arrangements.
Many companies using Contractors will choose to only accept one provider sometimes referred to as a Consolidator, which may create a situation where a very well rated client has moved the credit risk to an agency with a comparatively low credit rating and weak balance sheet. Knowledge and understanding are the keys to providing more cover than a rating would normally justify.
Acumen Credit Insurance have been working with Recruitment companies and Invoice Discounters for very many years and a client base including over 60 Recruitment companies proves testament to our expertise in this rapidly growing sector.