Building and construction payment platform ProjectPay has joined forces with Lloyds Bank Commercial Banking to help address the issue of late payments within UK construction.
ProjectPay and Lloyds Bank’s solution aims to eliminate missed or delayed payments and high rates of non-payment in construction supply chains, and to help mitigate the risk of misappropriation of funds or building project insolvency.
For the first time, project accounts can be made available as soon as a project is created on ProjectPay’s platform, without contractors having to wait weeks or months for project bank accounts to be set up.
Built on proprietary technology, the partners say that the solution is the first end-to-end secure payment solution built specifically for construction businesses.
‘Greater digitisation is critical’
The SaaS platform enables all levels of the supply chain to be paid at the same time, removing contractors’ insolvency risk, speeding up payments to contractors and tradespeople and improving cashflow.
Three APIs from Lloyds Bank enable ProjectPay’s collaborative project payment platform to ensure fair and fast payment of all UK project stakeholders, where payments are received the same day on approved invoices.
Lloyds Bank’s PayFrom API lets contractors deposit funds to Project Pay’s platform instantly. Its Event Driven Notification API then notifies stakeholders within the project supply chain that funds have been lodged in the account, ready for distribution.
Once Applications For Payments (AFPs) are processed, Lloyds Bank’s PayTo API gives all owed parties direct and immediate access to payment.
Steve Everett, head of Payments and Receivables, Client Products at Lloyds Bank Commercial Banking, said: “Greater digitisation is critical if UK construction is to overcome the issue of late payments.
“The solution we’ve developed with ProjectPay uses API technology to give businesses at every stage of a construction project’s supply chain confidence that they will be paid quickly and securely for their work.
“Every sector’s payment needs are different. Our work with ProjectPay underlines that collaboration between technology providers is an effective way to tackle industry-specific pain points.”
Louise Stewart, the former chair of an Australian Subcontractors Association, and CEO of ProjectPay, said: “We chose to work with Lloyds Bank due to its market dominance and understanding of the global payments issue we are solving.
“With this activity accelerating ProjectPay’s UK expansion, we now plan to become the mainstream payment method for building and construction projects globally – a sector estimated to be worth 10 trillion pounds per annum”.
Following the collapse of Carilion in 2018, the UK government created a series of new payment protections to help digitise payments in the construction sector.
This partnership helps support the objectives of the UK government’s Construction Sector Deal and industry specific consultations on retention payments.
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