The short answer
Most recruitment agencies in India charge a one-time fee calculated as a percentage of the hire’s first-year fixed CTC. Contingency fees are paid only when a candidate joins; retained executive searches are paid in instalments. The percentage rises with seniority, scarcity and confidentiality, and the replacement terms are as important as the rate.
The three main pricing models
Before comparing numbers, compare models. Two quotes with the same percentage can represent very different levels of commitment, effort and risk.
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Contingency recruitment
The agency is paid only if a candidate it introduces joins your company. The fee is usually invoiced on the joining date and calculated on the candidate’s annual fixed CTC. Contingency works well for specialist and mid-level roles where the market is reasonably active and you may brief more than one agency.
The trade-off: because the agency is paid only on success, it will naturally prioritise roles it believes it can close quickly. Hard, confidential or very senior searches often get less attention under a pure contingency model.
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Retained (executive) search
For leadership roles such as CFOs, finance heads and GCC site leaders, firms usually work on a retained basis. The fee is still linked to the role’s compensation, but it is paid in stages, commonly at the start of the search, at shortlist and at the offer or joining stage. In return you get an exclusive, research-led search: a market map, a structured assessment process and a dedicated team.
Read our comparison of retained vs contingency executive search for when each model fits.
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Dedicated hiring, RPO and project models
When you need to hire several roles at once, for example when setting up a GCC or scaling a finance team, agencies may offer a dedicated recruiter, a project fee for a batch of roles, or a recruitment process outsourcing (RPO) arrangement with a monthly retainer. These models trade a lower per-hire cost for a longer commitment.
What percentage is typical in India?
There is no official rate card, and pricing varies widely between firms, functions and cities. With that caveat, these are the ranges most commonly quoted in the Indian market:
| Type of role | Common model | Commonly quoted fee |
|---|---|---|
| Junior and volume roles | Contingency or bulk pricing | Often around one month’s salary (about 8.33% of annual CTC) or a flat fee |
| Mid-level specialist roles | Contingency | Commonly in the region of 8.33% to 15% of annual fixed CTC |
| Senior specialist and niche roles | Contingency or exclusive | Commonly 15% to 20% of annual fixed CTC |
| CXO and leadership roles | Retained search | Often 20% or more of annual CTC, paid in instalments |
Treat these as orientation, not benchmarks. A quote outside these ranges is not automatically good or bad; what matters is what the fee includes.
What drives the price of a search
- Seniority. Senior roles take longer, involve more stakeholders and carry a higher cost of a wrong hire, so fees rise with level.
- Scarcity of the skill set. Niche profiles such as GCC controllership leaders, FP&A heads with global exposure or experienced ML engineers take more research to find.
- Confidentiality. Replacing an incumbent or hiring ahead of an announcement requires discreet, direct approaches rather than job adverts.
- Exclusivity. An agency working exclusively can invest more effort, and some firms price exclusive mandates differently.
- Volume. Several hires for one team can justify a lower per-hire rate or a project fee.
- Location and mobility. Searches that need relocation, or candidates for a specific hub city, can change the effort involved.
- Replacement terms. A longer or more generous replacement guarantee carries more risk for the agency and is reflected in pricing.
Planning a finance or leadership hire and want to understand the right model for it?
See how Stellaspire worksTerms to check before you sign
The fee percentage is only one line in the agreement. These terms change the real cost of a hire:
What the percentage is calculated on
Check whether the fee is based on fixed CTC only, or on total CTC including variable pay, joining bonuses and benefits. The difference can be significant for senior roles.
Replacement guarantee
Most agencies offer a free replacement if the hire leaves within an agreed period. Confirm the length of that period, whether it covers resignations and terminations, and whether it is a replacement or a partial refund.
Payment schedule and GST
Contingency fees are usually due on joining; retained fees are split across milestones. Fees are generally quoted exclusive of GST.
Candidate ownership
Agreements usually state how long the agency is entitled to a fee if you hire a candidate it introduced, even for a different role. Make sure the period is reasonable and clearly defined.
Exclusivity and cancellation
For retained searches, check what happens to instalments already paid if you cancel or fill the role internally.
How to compare recruitment quotes fairly
- Compare like with like. A contingency quote and a retained quote are buying different levels of commitment.
- Ask what the fee includes. Market mapping, compensation insight, structured assessments, reference checks and offer support all add value.
- Ask for relevant proof. Similar roles filled, in a similar industry and seniority band.
- Look at the shortlist quality, not the CV count. Ten unsuitable profiles cost your team more time than three strong ones.
- Consider the cost of a wrong or slow hire. For critical finance and leadership roles, the cost of a vacancy or a mis-hire usually outweighs the difference between two fee percentages.
The cheapest search is the one that gets the right person in the role and keeps them there.
How to compare two agency proposals side by side
Proposals rarely follow the same format. Put the key terms from each one into a simple grid like this before you decide.
| What to look at | Question to answer | Why it matters |
|---|---|---|
| Fee basis | Is it a percentage, a flat fee or a monthly retainer? | Different bases can only be compared once you convert them to an expected cost for your role. |
| What counts as CTC | Fixed pay only, or variable pay, joining bonus and benefits too? | The same percentage applied to a wider base gives a higher fee. |
| Payment milestones | Is the fee due on joining, or split across start, shortlist and offer? | Upfront instalments are committed even if the search does not close. |
| Replacement terms | How long is the period, what does it cover, and is it a replacement or a refund? | This is your protection if the hire leaves early. |
| Exclusivity | Is the agency asking to work on the role alone? | Exclusivity can buy more effort, but it limits your other options for that role. |
| Notice-period handling | Is the fee triggered at offer acceptance or at actual joining? | Candidates often serve long notice periods, and some do not join after accepting. |
Once the grid is filled in, the gap between two proposals is usually clearer than the headline percentages suggest.
Red flags in a recruitment agreement
Most agreements are fair, but a few clauses deserve a second look before you sign.
- A vague fee basis. If the agreement does not say exactly which parts of pay the fee is calculated on, ask for it in writing.
- An open-ended candidate ownership clause. A claim on any candidate the agency has ever sent you, with no time limit, can lead to disputes later.
- No replacement terms, or unclear ones. If the conditions for a replacement or refund are not spelled out, assume you will not get one.
- A fee due before the candidate joins. Outside retained search, check why payment is expected at offer stage.
- No exit route for retained searches. Make sure the agreement says what happens if you cancel the role or fill it internally.
- Any fee charged to candidates. A legitimate agency is paid by the hiring company, not by job seekers.
Questions to ask before you sign a recruitment agreement
Frequently asked questions
Do candidates pay recruitment agencies in India?
No. Legitimate recruitment agencies are paid by the hiring company. Candidates should never be asked to pay a fee to be considered for a role.
When is a recruitment fee paid?
Under contingency, the fee is usually invoiced when the candidate joins. Under retained search, it is paid in instalments across the search, for example at the start, at shortlist and at offer or joining.
Is the fee calculated on CTC or fixed salary?
It depends on the agreement. Many agencies use annual fixed CTC; some use total CTC. Always confirm the basis in writing before the search starts.
What is a replacement guarantee?
A commitment to find a replacement, or refund part of the fee, if the hire leaves within an agreed period after joining. The length and conditions vary by agency and role.
Are recruitment fees quoted with or without GST?
Fees are generally quoted exclusive of GST. Check the agreement so the tax is not a surprise on the invoice.
Can I use more than one agency for the same role?
Under contingency, yes. Companies often brief more than one agency. Retained searches are usually exclusive, so check the exclusivity terms before you brief others.
How does Stellaspire charge?
Fees depend on the role, seniority, number of positions and engagement model. We share commercial and replacement terms in writing before a search begins.
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