Invoice finance for construction companies
Applications for payment, retentions and a smaller panel. Here is what construction and subcontracting firms actually get funded.
Invoices vs applications for payment
A standard invoice is a fixed, agreed amount owed. An application for payment (sometimes called an interim valuation or a payment application) is a claim for the value of work done in a period, which the client or main contractor then certifies, usually at a lower figure once retention and any disputed items are deducted. Most invoice finance providers only fund once that certification happens, because the gap between what is applied for and what is certified is exactly the kind of risk general credit insurers will not cover.
A smaller number of specialist construction funders will advance against an application before certification, at a lower advance rate and closer scrutiny of your certification history. Where your book fits, we match you to that smaller panel rather than a generalist provider who will simply decline the application.
Who it helps, who it does not
- Subcontractors invoicing main contractors on standard terms once work is certified
- Main contractors with a consistent record of applications certified close to value claimed
- Firms that can supply certified valuations, not just self-raised applications, as evidence
- Small jobbing builders invoicing homeowners directly, that is consumer work, not B2B
- Businesses with a live payment dispute or a pattern of heavy contra-charges
- Firms whose billing is mostly uncertified applications with no certification track record
Worked example
A subcontractor with a £60,000 certified interim valuation, funded at 75% given the sector risk:
What does not get funded
- Retention money held back until practical completion or the defects period ends
- Applications with a weak or disputed certification history
- Uncertified claims on a contract with an active payment dispute
- Work for a main contractor with a documented pattern of late or short payment
Frequently asked questions
Some funding partners will, but not all. An application for payment (or interim valuation) is a request for money under a construction contract, not yet a certified invoice, so it carries more risk than a standard B2B invoice. The partners who do fund them typically want to see a track record of applications being certified close to the value claimed.
Retentions, payment disputes, set-off rights under construction contracts, and the risk of a certified value coming in below the application all make construction debtors harder to underwrite. A meaningful number of general invoice finance providers simply do not touch the sector, which narrows the panel compared with, say, wholesale or logistics.
Rarely, and we will say so rather than imply otherwise. Retention money, typically 3 to 5% held back until practical completion or the end of a defects period, sits outside most facilities. What gets funded is the certified value released after retention, not the retention itself.
Both can qualify, but the underwriting differs. Subcontractors are assessed partly on the main contractor paying them, so a main contractor with a poor payment record can limit what a funding partner will advance, even if your own invoicing is clean.
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See how much you could releaseLast reviewed: August 2026
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