Can a construction company get invoice finance?

Updated September 2026

Yes, but from a shorter list of funders and at a lower advance. Where a manufacturer or a haulier can expect 80 to 90 percent of each invoice up front, construction sits at 70 to 85 percent, because what a contractor raises is often not an invoice at all: it is an application for payment under a contract, subject to certification, a pay-less notice and a retention that is held back for months. General invoice funders will not touch that; construction specialists underwrite it every day.

The difference matters more than the percentage. A funder that understands the Construction Act and the way a main contractor certifies work will advance against applications and manage the retention; one that does not will exclude half the ledger and call it a facility. We arrange finance for UK limited companies, LLPs, sole traders and partnerships through the 20 invoice finance lenders on our panel, and the first filter for a construction ledger is which of them fund contractual debt at all.

What makes construction different

Four things, and each one removes funders from the list.

Applications for payment. Under most construction contracts you apply for payment and the client or its surveyor certifies the amount. Until it is certified, there is no debt to finance. Specialist funders advance against the application on a lower percentage and true it up on certification.
Retentions. Typically 3 to 5 percent of each payment is held back, half released at practical completion and half at the end of the defects period, often a year later. That money is not fundable in the ordinary way and comes out of the advance.
Pay-less notices and set-off. The client can reduce a certified sum for defects or delay, and a main contractor can set off across contracts. Funders price that risk into the advance rate and the concentration limits.
Concentration. A subcontractor working for one or two main contractors has a ledger where most of the money is owed by one name. Funders cap the exposure to any single debtor, and a two-customer ledger is capped hard.

What a construction facility looks like

Read across for the terms a contractor should expect. Every funder sets its own; these are the shape of the market as we see it on our panel.

Term	General invoice finance	Construction invoice finance
Advance against each invoice or application	80% to 90%, up to 95% on a strong ledger	70% to 85%
What is funded	Invoices for goods delivered or services done	Certified sums and, with specialists, uncertified applications at a lower rate
Retentions	Not applicable	Excluded from the advance; some funders release against them at practical completion
Debtor checks	Credit limit per customer	Credit limit per main contractor, plus a read of the contract terms
Service fee	Roughly 0.5% to 3% of turnover through the facility	The same range, towards the upper part
Set-up	About a week with an independent, closer to two with a bank	Two to four weeks; the contract review is the extra step

What the panel says

Counts are distinct lenders on our panel with a live product for each feature, checked September 2026. They describe the panel, not an offer to you, and composition changes over time. The catalogue does not record which invoice funders take construction ledgers, so that filter is applied case by case against each funder's own criteria.

20 invoice finance lenders in total; 15 fund a business trading under a year and 8 accept minor adverse credit on the borrower.
33 of the 38 asset finance lenders fund construction plant and 15 fund scaffolding stock, for the kit side of the same business.
32 fund vans.

What to have ready

The contracts, or at least the payment terms and the retention clause, for the main contractors you work for. An aged debtor report that separates certified sums, applications not yet certified and retentions, because that split is the first thing a specialist funder asks for. The last accounts, three months of bank statements and a note of any charge your bank already holds over the book debts. And a straight answer on how many main contractors you work for, because the concentration limit decides how much of the ledger is fundable.

Where the ledger is too thin to fund, the alternatives are asset finance on the plant and vans, which most of the asset panel will do for a contractor, and an unsecured loan or a cash advance for the working capital. This page is general information, not advice.

Frequently asked questions

Why is the advance lower for construction?

Because the debt is less certain. An application for payment can be certified at a lower figure, reduced by a pay-less notice or set off against another contract, and the retention is held back for months. The funder advances less so that what it has paid out is still covered when the client pays less than was applied for.

Can I fund retentions?

Not in the ordinary advance. Some specialist funders release a proportion at practical completion, when the first half of the retention falls due, and a few will look at the second half against the defects period. Most contractors treat retentions as unfunded and price them into the job.

Do my main contractors find out?

With a factoring facility, yes: they are told to pay the funder. With confidential discounting, no, but construction funders offer it less freely, because they want the right to verify applications directly with the client. Ask which it is before you sign.

Is a subcontractor with one main contractor fundable?

Sometimes, with a hard cap. A ledger owed by one strong main contractor on a long framework can be funded up to a limit; the same ledger owed by one small contractor usually cannot. Two or three good names on the ledger changes the answer more than anything else you can do.

Send us the ledger and the contract terms

An aged debtor report split by certified, applied and retained, and the payment terms you work to. We say which funders take construction debt and what they would advance.

Check your options

Sources

Checked September 2026. Advance rates and retention practice vary by funder and by contract; the figures here are the shape of the market, not a promise about any one facility.

Important information

CapExpand Ltd (FRN 1060885) is an Appointed Representative of White Rose Finance Group Limited, which is authorised and regulated by the Financial Conduct Authority (FRN 630772). We are a credit broker, not a lender, and we do not provide financial, tax or legal advice. We work with a panel of lenders whose particulars are available on request. If a deal completes the lender pays us a commission, at no cost to you; different lenders pay different amounts under different models, and we will tell you the amount for your deal on request. All lending is subject to status, valuation where applicable and the lender's own checks.

Registered office: Pure Offices, Lake View Drive, Annesley, Nottingham, NG15 0DT. Company No. 14433858.