The executive chairman of recruitment platform Human Capital Investment Group (HCIB) has urged UK banks to widen their definition of risk when considering whether to provide finance to staffing companies wishing to expand internationally. 

Tristan Ramus tells Recruiter that the UK banks’ support for staffing companies in international markets is constrained by their narrow perception of the risks involved.

Referring to invoice discount finance, Ramus says the problem is “their perception of the collectability of debts if they advance on invoices”. Decisions are also often made on a territory-by-territory basis, Ramus continues, adding: “Africa is a territory where it is nigh on impossible to get finance.”

Ramus says he has seen two cases in the past three months, one in Brazil and one in Eastern Europe, where two “£100m+ staffing companies” have had to turn away large staffing contracts because they couldn’t get the funding.

Ramus did not name the staffing companies or the banks concerned. However, he says “they [the staffing companies] had to put the opportunity on hold” adding “the client will go elsewhere”.

Ramus urges banks to broaden their definition of risk to include additional factors. These include their balance sheet, cost control, cash management and the strength of the management team.

Both HSBC and Lloyds say they are doing their bit to support UK recruiters overseas.

• For more on this topic, see the News Analysis on p11 of the new October issue of Recruiter, out this week.