Football Finance 2.0 – Navigating Debt Finance Under the Premier League’s Post‑PSR Framework

From the 2026/27 season onwards, the Premier League (the PL) will replace its Profitability and Sustainability Rules (PSR) with a two‑pillar framework:

• the Squad Cost Ratio (SCR); and
• Sustainability & Systemic Resilience (SSR).^[1]

SCR will limit on‑pitch expenditure to 85% of a PL club's, 'football-related revenue and net-profit/loss from player sales'^[2] across a season. This financial road-mapping is intended to dovetail with UEFA’s Financial Sustainability regime whose “Squad Cost Rule” uses a similarly calculated cap of 70%^[3] and the UK Government’s new Independent Football Regulator (the IFR) framework.^[4] PL clubs will be able to exceed the 85% threshold, to account for real-time changes to pre-budgeted calculations made in respect of football-related revenue at the beginning of the season e.g. additional sponsorship deals in-season, or unexpected progression in a European competition, which contributes to additional revenue than originally budgeted.

“Football-related revenue” will include the likes of matchday, broadcasting and sponsorship revenue. Despite this, income generated from youth academies and women's teams will be excluded, to promote continued incentives to invest in these areas. Given the inclusion of sponsorship and many commercial revenues in direct connection with squad spending, it will be interesting to observe whether the “Fair Market Value Assessment”^[5], under the PSR regime, which is used by the PL to assess such transactions will be scrutinised and policed more heavily going forward.

SSR will also introduce forecasted working‑capital, liquidity and balance‑sheet tests assessed on a short to long-term basis to monitor financial stability. The change is not merely technical: it re‑prioritises club finance away from loss‑based monitoring and towards ratio‑based cost control and financial resilience to unforeseeable, monetary impacts on clubs. As SCR's expenditure limits are like that of the UEFA threshold, it should not only help clubs to manage their finances when qualifying for UEFA competitions or falling out of them but also ease the burden of dual reporting for clubs in the PL and UEFA competitions in the same season.

Therefore, this article examines the SCR/SSR framework from a debt financing perspective. It considers how the new rules may constrain clubs' borrowing capacity, how lenders are likely to respond in their covenant and security packages, and what the framework means for insolvency risk and working capital management.

It looks at:

• The Architecture of SCR and SSR
• Debt Capacity and Leverage
• Liquidity, Working Capital and in‑Season Cash Management
• Insolvency Risk and Restructuring
• Key takeaways for borrowers and lenders
• Conclusion