Man City's £550m problem could send shockwaves through football

Analysis

Paul Macdonald | Brand Owner

Man City have too many problems to mention.

The Premier League have solidified their position that they will likely seek maximum punishment for their 114 confirmed financial breaches, which holds massive implications for future club operations, not least which league they will be playing in, in future.

There are likely individual litigation cases which will develop, too; Manchester United, Arsenal, Liverpool and Tottenham formally retained the option to explore individual, or perhaps collective, legal cases against City for lost earnings. That will be a clear by-product of the resolution of the case should, as is expected, the independent commission side with Premier League after the inevitable City appeal.

But one of the other by-products could emerge as a serious problem for everyone; net transfer receivables.

Until recently, City had been more prudent in their transfer dealings, utilising the strength of their youth and scouting system to offset their spending in a more sustainable fashion. That has changed, drastically, in the last 18 months alone.

Let’s talk about the structure of a transfer itself. When a deal is done, the fee is rarely, if ever, paid directly in cash at that moment; rather there are payment structures that allow payments to be spread over a specific period to the receiving club. Various figures suggest that, broadly, 35-40% of a total transfer fee is paid at the execution of the transfer. To provide an acute example this means when Enzo Fernandez moves for £117m from Chelsea, somewhere in the region of £40-£46m will be paid immediately. Again, until City’s accounts for 2026 are filed we can only speculate, but with some basis of reality, as we’ll show below.

Man City's summer signings

This will also work in the other direction, for fees owed to City for selling them players. This mechanism has exploded in usage in recent years, with more transfer payments being deferred, with interest also applied.

The lavish spending of Premier League clubs has increased again, reaching over £3.5 Bn spent in the summer 2026 transfer window alone. According to reporting by noted finance expert Paul Quinn, net transfer debt just 10 years ago sat at a modest £165m. By last summer, that had reached £2.2 billion, and with another crazy summer of business, this has reached an estimated £2.85 Bn of net transfer debt. In short, more money is being spent than ever, and ever more of it is being pushed down the road to be paid at a later date.

Back to City. Their involvement in this cycle, even three years ago, was modest at best. As shown by Greg Cordell’s summation of the situation, City’s net transfer debt was as low as £39.6m million in 2022. But the club have been on an aggressive splurge in the past 18 months, spending £720m since the last summer window. Again, this is not about net spend; this is about the amount the club has agreed to pay, some of which at the point of transfer, some of which deferred until later.

As per their 2025 accounts, City’s net transfer debt sits at £327.6m, a drastic increase in just a few short years. And this doesn’t take into account the £458m spent this summer, after which their current net transfer debt figure will become clearer. But if we take the view that around 35-40% of a fee is paid up front, and the rest were to arrive in installments, we can expect City’ net transfer debt for 2026 to be - in a best case scenario - in the region of £550m, and in all reality quite a bit more than that.

With normal business trading among PL clubs, this figure remains a concern but not one that can’t be fulfilled. Indeed Manchester United’s current obligations from 2025 exceed City’s. But their future ability to pay is, on paper, not in question. However if City’s circumstances change abruptly - as could be the outcome of the independent panel - this is no longer a Manchester City problem, but a transfer market problem.

The reason for this is clear; the transfer market is a tangled web of clubs owing money in, and money out. Barcelona’s 2024/25 accounts showed they still owed Bayern Munich £17m for the transfer of Robert Lewandowski, a player who signed in 2022 and has now left the club. That’s how these deals work, and as long as every link in the chain fulfills their agreed-to obligations, then, broadly speaking, the machine keeps rolling on.

But what happens if one element of the chain is broken, one with £550m in liabilities? The knock-on effects of the City verdict could have a long-lasting impact on their ability to fulfill those obligations. And this impacts every club from a pure cash-flow perspective; booked revenue scheduled to arrive simply doesn’t or perhaps has to be renegotiated at a markdown rate.

This is the least of City’s concerns right now. They have bigger battles to fight in the coming weeks and months with the Premier League and the aforementioned cabal of clubs ready and waiting to strike their own legal disputes.

But the knock-on effect doesn’t just impact the clubs City have done business with; it is a going concern for any club who has done business with a club who has done business with City. In any given transfer there are potentially not only two clubs involved, but if we bring in sell-on clauses and the deferred payment schedule of the transfer before the transfer, you can see how this spirals out of control extremely quickly.

And that, alone, should make quite a lot of chairmen nervous.

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Written by

Paul Macdonald | Brand Owner

Paul Macdonald is a writer, journalist, editor and co-founder of the FootballTransfers website.

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