Our competitors may not include certain charges in the fee they quote. Hidden costs are usually credit search costs, wage slip charges or fees based purely on 30 debtor days.

• Credit searches perhaps charged at £10 per search
• A charge to produce each wage slip, typically between £2.50 and £3.00 per worker
• Basing the funding charge on 30 debtor days when debtor days are typically between 45 and 60 days

How will these costs affect the true fee you pay?

• Let's assume you generate £5,000 per week in revenue and are quoted a fee of 5.00%
• Each week the fee will be £250
• Also, you will typically be placing 10 workers per week. The weekly payroll cost may be £25. This increases the fee to £275, which is 5.50%.
• Over the year you may require 10 credit searches to be completed, raising the total annual fee to £14,400. So the actual fee you pay over the year is 5.54%!

And what about a fee based on 30 debtor days?

Typically a fee is broken down into three parts: the admin fee, the cost of funding and bad debt protection. For example:

• Admin fee = 2%
• Daily Funding fee = 2% + Bank of England base rate
• Also, you will typically be placing 10 workers per week. Over a year this will cost £1,300 in wage slip costs
• Bad debt protection = 0.5%

The total fee here is 3.08%. But if the debt is paid on day 60 then the real fee is 3.65%. This is because the funding fee is charged on a daily basis.

So for an agency generating £5,000 per week, the quoted fee is £154, but the actual fee is £182.50 - an increase of £28.50. Over a year this will cost you an unexpected £1,482.