Project Payment Accounts

Direct-to-supply-chain payments for your JCT, NEC or bespoke prime construction contracts.

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Built for construction

Protecting your projects

For Employers

Get greater visibility over your supply chain and reduce the risk of late payments or the main contractor's insolvency. Allow the supply chain to concentrate on delivering your project.

For Main Contractors

Reduce your finance administration cost and, when partnered with an escrow account, get comfort that your payments will be received on time.

For Sub-Contractors

Receive your payments as much as 60 days sooner, reducing your administration and costs of cashflow finance, and protecting you in the event of the main contractor's insovlency.

Project Payment Accounts

An Introduction...

What is a Project Payment Account?

Project Payment Accounts (often called Project Bank Accounts) are ring-fenced bank accounts set up specifically to deal with payments to the supply chain for large contracts.

How does a Project Payment Account Work?

See below. We've build a helpful walkthrough of the lifecycle of a Project Payment Account.

What are the benefits to the Employer?

All of the suppliers get paid on time, ensuring that your works progress to schedule and minimising the risks of delays or of a supplier pulling off the project (and the attendant costs of these). In the event that the Main Contractor becomes insolvent, the wider supply chain won't suffer, and a new Main Contractor can assume the role with a minimum of disruption.

What are the benefits to to the Main Contractor?

The Main Contractor can reduce its administrative overheads considerably, as they will no longer need to manage payments to the wider supply chain. Project Payment Accounts are usually partnered-up with Escrow Accounts to guarantee payment into the supply chain, which gives the Main Contractor some additional comfort.

What are the benefits to the supply chain?

Everyone lower down the chain than the main contractor gets paid significantly faster than under the traditional payment methods. This means that they have to spend less time chasing invoices, can avoid expensive factoring costs, and can concentrate on delivering their craft to the project.

How much do they cost?

Please do feel free to contact us for a specific cost for your project. Generally-speaking, Employers can expect to save money through the operation of a Project Payment Account, both by eliminating risk and driving efficiencies throughout the supply chain to lower prices.

Are there any other benefits?

Adopting a Project Payment Account gives the Employer direct line of sight to the pricing and costs of the wider supply chain. This transparency promotes efficient working and reduces the incidence of hidden or undisclosed commissions which might otherwise not be apparent.

Project Payment Accounts

How our Project Payment Accounts work

Enabling Provisions

We assist the parties with the implementation of additional wording in the build contract to allow for payment from a Project Payment Account directly to the supply chain to satisfy the Employer's payment responsibilities under the contract.

Account Agreement

The Employer and the Main Contractor open an account with us in their joint names, both as trustees for the supply chain. Any identified suppliers at this point sign up to the account for payment.

Additional Parties

As more suppliers are added to the project, they each sign up as beneficiaries under the Project Payment Account, by way of simple application countersigned by each of the Employer and Main Contractor (or their delegated representatives).

Payment Cycles

Valuations take place as usual, and the Main Contractor issues an invoice to the Employer in exactly the same way it would under the traditional payment method. Sub-Contractors need to align their payment cycles with the Main Contract cycle as usual. This includes a schedule of payments to be made to the supply chain to satisfy its obligations to the sub-contractors.


The Project Payment Account is provisioned either directly by the Employer, or from a partnered Escrow account, as agreed, and the supply chain payments are authorised by the Employer. This takes place no later than 5 days before the final date for payment.


Each of the Main Contractor and all of the other supply chain suppliers receives that month's payment within 3-5 days.


Implementing a Project Payment Account

Tender Stage

The Employer should ensure that the benefits of the Project Payment Account are understood and that prospective tenderers understand that they should communicate the benefits to the wider supply chain to maximise sub-contractor sign up and any potential associated reductions in cost for the project.

Pre-Qualification Questionnaires

Employers may wish to add wording to their Pre-Qualification Questionnaires along the following lines:
'If you are the main contractor, the Employer may require, under the contract, that you use a Project Payment Account as the primary method of payment to some or all of your sub-contractors. Are you willing to comply with this requirement?'

AML/KYC Due Diligence

We are required to carry out our due diligence on all parties to a Project Payment Account. In order to ensure the smooth functioning and speedy set up of the account, we encourage early dialogue so that the parties may collect the relevant information in good time. If the supplier is already verified by us, this additional step is not necessary.

Partnered Escrow Accounts

Employers and Main Contractors will generally agree to partner an escrow account with a Project Payment Account. Under this arrangement, the Employer will pre-fund the escrow account with 3 months of anticipated project payments on a first-in, first-out basis. When a monthly payment cycle is run, sufficient funds to enable the payment run will be moved from the escrow account to the Project Payment Account, and the Employer will top up the escrow account. This gives the main contractor confirmed line of sight of 3 months of anticipated payments throughout the project.

Project Payment Account vs Escrow

Understanding the differences

Escrow AccountProject Payment Account
Ring-Fenced FundsPayment Mechanism
Protects Main Contractor from Employer Insolvency
Protects (lower) Supply Chain from Employer Insolvency
Provides low-cost recourse against Employers
Accelerates payment to lower supply chain
Protects lower supply chain from Main Contractor insolvency
Supports free flow of monies through the project
Escrow Information

Frequently Asked Questions

Do Project Payment Accounts affect the Main Contractor's turnover and shareholder value?

No. UK GAAP FRS 5, Application Note G, Paras G60-72 confirm that there is no change from the traditional payment method.

What happens if there are insufficient funds in the Project Payment Account when payments fall to be made?

The Project Payment Account Trust Deed provides that all of the beneficiaries of the trust (the Main Contractor, Sub-Contractors and Named Suppliers) have a pro-rata entitlement to the funds in the Project Payment Account. In the event that there are insufficient funds, each party's payment shall be reduced on a pro-rata basis. Once the account is topped back up, the balance of any payments can be made to the parties. This is why Project Payment Accounts are often partnered with an Escrow account to act as a top-up mechanism.

Is a Project Bank Account the same as employer pre-funding or escrow?

No. A Project Payment Account is a payment mechanism. It can be used with an escrow account, however, to help give comfort to all project participants, with the escrow account funding the Project Payment Account upon provision of the relevant certification. Together, they represent a strong protection for the supply chain and, thus, the Employer.

Does the existence of a Project Payment Account change the contractual provisions relating to interim applications and payments?

No. Provisions relating to interim payments, including those dealing with interim applications, valuations, authorisations and certification are unaffected by the use of a Project Payment Account.

How does a Project Payment Account affect the tax position of the parties?

HMRC has confirmed that the use of a Project Payment Account does not change a party's VAT or CIS status or responsibility.

Can the Employer, as Trustee, exercise control over payment amounts?

No. The Employer's role as trustee is simply to authorise the release of monies, not the amount. In practice, the Employer's role in the Project Payment Account would likely be discharged by the Project Manager, Contract Administrator or similar.

Further Information

Request a quote or sample account documentation


Regulatory Notices

Payment Services Regulations 2017

dospay is a trading name of DOS & Co. Ltd, a company registered in England and Wales with company number 08294966.
DOS & Co. Ltd. is registered with the Financial Conduct Authority under the Payment Services Regulations 2017 (FRN: 833374) for the provision of payment services. Digital Batch Payments are powered by Payment Rails Ltd, which is authorised by the Financial Conduct Authority (the “FCA”) under the Payment Service Regulations 2017 (registered reference no. 771016) for the provision of payment services.

dospay is wholly-owned and operated by DOS & Co.

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