Chelsea FC have been spending enormous sums of money since American Todd Boehly’s takeover of the club. The sheer scale of spending has been enormous – with over £400million spent this season alone!

This has led many to wonder how Chelsea are doing this. After all, Financial Fair Play exists, and the club do not have a bottomless pit of money. But Chelsea are using some interesting techniques to keep things legal, including reportedly using a factoring company.

The Spending

American Todd Boehly completed a takeover of Chelsea FC at the end of May 2022, following Roman Abramovich selling the club. Boehly – backed by a consortium – became the Chairman.

Boehly has financed significant spending. In the summer, they spent over 200million, with Raheem Sterling, Kalidou Koulibaly, Marc Cucurella and Wesley Fofana all commanding significant fees.

This spending has continued in the winter, with another 200million being spent on the likes of Benoit Badiashile, Mykhailo Mudryk and Joao Felix. Football has simply never seen spending like this!

In an age though where clubs need to be vigilant around Financial Fair Play, many have questioned how Chelsea can afford these wild fees, whilst remaining financially compliant.

Long contracts and accounting

To begin with, it is worth noticing that Chelsea are signing players on long contracts. This is good for numerous reasons, especially for accounting purposes.

For example, Chelsea’s signing of Mudryk from Shaktar Donetsk cost approximately £80million. However, Chelsea will be sending this payment over an 10-year period, meaning in essence they are spending around £10million per year. A similar plan is in place with Badiashile, who is on a 7-year contract.

Therefore, using this approach for several different signings means that for accounting purposes, a much lower expenditure happens each year. This is how Chelsea can make it look as if they aren’t paying huge fees, as the money is split up year-on-year.

Doing deals this way also protects Chelsea from losing players cheaply, like we saw with Antonio Rudiger last season. Instead, they will have plenty of time to secure sales for unwanted players.

The only real risk with this model is that if a player underperforms, it will be very difficult to get rid of the player. We have seen this with Tiemoue Bakayoko, who underwhelmed for the club, but is needing to be loaned out each year.

There is also the large wage increase, which could cause some concern. But Chelsea will hope that they can return to top competitions soon, in order to recoup some more money, and help with these wage increases.


But even with the fees being channelled in an effective way for accounting purposes, Chelsea have also reportedly used a tool called “factoring”, to help fund their enormous spending.

Factoring is the practice of a business buying another business’ unpaid invoices. Therefore, a third-party company is effectively buying Chelsea’s unpaid invoices from them. For example, if a club is due to pay Chelsea £10million per year for the next five years, the factoring company may pay Chelsea £45million upfront, in exchange for then receiving the five £10million annul payment.

Therefore, Chelsea receives an immediate payment, while the factoring company will make an extra £5million in the long-term, albeit having to part with £45million in the short-term. But factoring companies generally have multiple investments at a time, making it a lucrative business to be in.

Chelsea receives short-term money, at a loss of a small amount over five years, while the factoring company takes the short-term hit, but knows that in the long-term, they will be rewarded handsomely for their efforts. It is a win-win situation.

So by using factoring, Chelsea have more money to spend. While it hasn’t officially been confirmed that Chelsea are using this approach, it is believed that this approach has been used by the club.

Using factoring for outgoing transfers

It can also work in a slightly modified way for outgoing transfers. The factoring company could pay the selling football club the full transfer amount, before Chelsea pays the factoring company back over many years.

For example, if Chelsea were to use a factoring company for a £100million purchase, the factoring company would pay the £100million to the football club that is selling the player that Chelsea are buying. Then Chelsea will pay the company back over a long period of time – often 10 years – with a small rate of interest attached.

It is possible to think of this as a “Klarna” type situation – only that it involves tens of millions of pounds, rather than the £20 we spend on trainers, and use Klarna to make the payment.

Again, this situation represents a win-win scenario, with all three parties left happy. It is a format that we are likely to see more of in the coming years, unless FIFA decide to step in and put a stop to the practice.

Incoming fees

Then it should also be remembered that Chelsea do have many players that have transferred to other clubs. The club is renowned for signing young players, loaning them out, and then eventually selling them if they aren’t good enough to play for the club.

All of the sales do add up. While the sales only scratch the surface of the money spent, it does at least end up with the club recouping some fees, which can help offset some of the outgoing transfer expenditure.

The Takeaway

Chelsea FC are going through a bit of a rough patch currently, but at the same time, these are exciting times for the club. They have a lot to look forward to, with many exciting young players due to burst into the team going forward.

While this immense spending power is unlikely to remain year-on-year, Boehly and the club’s board are certainly not holding back this season! Importantly, they are spending in a way that favours accounting, and keeps things above board and legal.