Banks are continuing to pay their staff billions of pounds in bonuses despite a raft of mis-selling scandals and lack lustre profits.

However, speaking to IBTimes TV, Xactly's principal incentives strategist director Erik Charles revealed how paying the 'market rate' is essential to retaining top staff and making sure the cream of the crop stays on board.

Charles also revealed that bonuses can be toxic to the industry but there are a number of key ways provide best practice, less risk and retaining top talent but making some amendments to incentive schemes.

Xactly works with a range of companies of all sizes and industries to provide research and insight into optimal incentive compensation programmes, while also motivating staff.

European Union bonus caps will mean that banks can only pay bonuses worth 200% of the person's salary but Charles reveals how there are a number of loopholes to get around the new law.