Payroll on Friday, client payment in 60 days… How does factoring for employee outsourcing stabilize business?
Managing a modern employment agency resembles an exhausting Italian classic cycling race. You can acquire great candidates and multi-million contracts, but if you run out of “financial fuel” during the long wait for a transfer, success will quickly slip from your hands. Where is the solution to this problem hiding? In this article, we suggest how to effectively manage liquidity and what tools will allow your company to maintain a strong pace from start right to the finish line.
Key takeaways:
- The increase in employment costs clashing with long payment terms from clients (even up to 90 days) creates a burdensome liquidity gap.
- Factoring helps to face this challenge by turning issued invoices into cash that usually hits the agency’s account within 24 hours – ensuring funds are available for salary payments.
- When selecting a specific service provider, it is above all worth looking for a partner who understands seasonal fluctuations in employment.
In the HR industry, the rhythm of cash flows can be exceptionally ruthless. On the one hand, you have to execute strictly timely payouts for hundreds of employees every week or every month. On the other hand, large corporate clients from the B2B sector impose 60-, and often even 90-day payment terms. How to bridge this gap?
Why is liquidity such a big challenge in the HR sector?
To fully understand the scale of the challenge faced by employment agencies, it is enough to look at hard macroeconomic data. Since January 1, 2026, the minimum wage in Poland has increased to 4806 PLN gross. For an employer, this means that the total cost of employment (the so-called super gross) currently amounts to almost 5790 PLN per month for one full-time equivalent. The difference between the amount the employee actually receives “in hand” (around 3605 PLN) and the real cost the agency has to bear is nearly 2200 PLN per person.
– When deploying 100 employees to a factory or logistics center, the agency’s monthly obligations for salaries, social security contributions, and income tax advances alone – assuming the employees earn the statutory minimum wage – amount to nearly 600,000 PLN (!) for a single month, which must be secured immediately. B2B clients, however, keep them waiting, which creates a liquidity gap and massive stress for CFOs and owners of outsourcing companies – explains Leopold Kasjaniuk, General Manager at Ifis Finance.
The numbers speak for themselves. According to the Trenkwalder Polska report, nearly half, as much as 47% of Polish employers consider high labor costs to be the biggest challenge, and among smaller companies, this percentage is 57.5%.
How do payment bottlenecks amplify the problem and how to deal with them?
Long terms shown on an invoice are one thing, but delays in payments are a real threat to cash flow. Today, the average waiting time for SME sector companies to be paid by business clients is as much as 62 days. BIK alerts: the value of overdue debt of Polish enterprises has already crossed the threshold of 46 billion PLN. Therefore, the results of the BIG InfoMonitor study should not be surprising, according to which as many as 76% of companies plan to take decisive action in 2026 to eliminate payment bottlenecks.
This is exactly where factoring for employee outsourcing comes to the rescue. Instead of wasting time and nerves on soft debt collection – which can “cost” Polish entrepreneurs an average of up to several dozen working days a year – an HR agency can turn issued invoices into cash.
How does the factoring for employee outsourcing release frozen cash?
The mechanics of factoring are transparent and perfectly adapted to the dynamic pace at which temporary employment agencies operate:
- Your company issues an invoice with a deferred payment term (e.g., 60 days) to a client.
- You forward this document to a factoring company (the factor).
- The factor verifies the invoice and instantly pays you an advance, usually reaching 80-100% of the document’s gross value.
- You have the cash for payroll, you settle social security and taxes, and after 60 days, your client pays the invoice directly to the factor’s account.
Factoring is a relatively simple but highly effective solution that allows many entrepreneurs to maintain peace of mind and independence, without nervously checking their account balance every Friday.
Factoring vs. a bank loan – what to choose?
Many companies struggling with financial liquidity look for help in banks first. However, a traditional working capital loan increases debt on the balance sheet and usually requires hard asset collateral. Moreover, bank scoring algorithms often ruthlessly reject applications from very dynamically developing companies.
At Ifis Finance, we operate in a completely different, boutique model.
– Instead of automatic scoring, each transaction is evaluated individually by an experienced analyst, and the entrepreneur contacts a dedicated account manager who understands his business and is up-to-date with changing employment cycles – explains Leopold Kasjaniuk. – Most importantly – in factoring, we primarily assess the payment capacity of your contractors, often large manufacturing companies, and not just the creditworthiness of the agency itself – he adds.
Relationship building and lack of "pacts with the devil" – why Ifis Finance?
Italian craftsmanship has been famous for centuries for its precision, artistry, and perfect custom fit. We approach finances in exactly the same way. Our services are characterized by full transparency – we do not have hidden tables of additional fees, and our rates are comparable to bank factoring.
We perfectly understand that the outsourcing industry can be seasonal, which is why we do not impose rigid turnover limits and do not penalize for failing to meet them, and the client can terminate the contract without any penalty fees. Furthermore, thanks to the powerful backing of our Italian parent company (Banca Ifis), we are the natural and strongest partner for agencies that export services to Italy – a very attractive market, but characterized by extremely long payment terms.
Frequently Asked Questions (FAQ) about factoring for employee outsourcing
Does factoring for employee outsourcing require hard asset collateral?
No. Unlike restrictive procedures for bank loans, Ifis Finance does not require any collateral on your fixed assets (e.g., mortgages). The standard security for the transaction is the receivable itself indicated on the invoice (i.e., a confirmed assignment of receivables) and a blank promissory note with a declaration.
My agency experiences seasonal fluctuations. Will I incur penalties for lower turnover?
In the non-banking services market, penalties for failing to achieve minimum engagement thresholds are common. At Ifis Finance, we approach business as a partnership and fully accept the seasonality of many industries. We do not apply penalties for lower turnover in a given month or fees for terminating the agreement.
How quickly does factoring for employee outsourcing release funds for payroll?
We want to ensure that you can operate without interruptions. Funds from a properly assigned invoice can reach your account (without the need to change banks or grant powers of attorney) typically within 24 hours of approval, allowing for the seamless payment of employee salaries, taxes, and social security contributions.
Does factoring for employee outsourcing help with foreign contracts?
Yes, export factoring is an excellent tool for agencies delegating employees to European Union countries. As an institution with Italian roots, we have an operational capability unique on the Polish market for lightning-fast verification of foreign debtors and taking over the risk of non-payment, which relieves the Polish entrepreneur of the burden of independently monitoring the foreign market.
