Contractors in the construction industry have a long-standing issue with late and non-payment.
Lloyds Bank reported in 2016 that SMEs are owed £586 billion in unpaid invoices. The construction industry has one of the worst payment records in UK business.
When Did The Problem Start?
Companies increased outsourcing in the 1970s to allow them to reduce the pressure of constantly winning work and to avoid the risk of their workforce being idle during quiet times. This created a longer supply chain with payment requests for goods or services having to pass through more people.
Why Do Clients Withhold Payment?
Contracts give some assurance with regard to payment. For example, in construction they provide an incentive for a contractor to return to site to fix issues found in their work. However, we still suffer from late and non-payment. The Federation of Master Builders alleges that clients are withholding payment having discovered ‘make-believe faults’.
Cash flow issues are the most likely cause for this. Clients and contractors may not have the money available and prefer the contractor to bear the financial strain.
How Can PongoPay Help?
PongoPay is a mobile app payment tool for the construction industry. With our product, every step in your transaction is verified with proven tracking and verification procedures.
1 – The product uses a five-step Escrow process to verify that Payment has been made into the Holding Account before work starts.
2 – Your Clients are also protected as they can inspect the work being carried out before funds are disbursed.
3 – The Tradesperson isn’t paid until the Client accepts the work, or the agreed review period expires.
4 – PongoPay offers a fair and effective Dispute Mediation Process in order to resolve any disputes in order to release funds in the Holding Account.
Running your own business is hard enough without the headache of payment problems. PongoPay can be your solution.
Get in touch today to arrange a demo of our service.