Invoice Factoring for Construction Companies: A Practical Guide to Boosting Cash Flow Without Taking on Debt
Last updated: June 25, 2025
Written by Michael Pajar | Director, Casey Asset Finance
Tired of waiting 60–90 days for payment? Here’s how construction businesses in Australia are using invoice factoring to unlock cash faster, stay job-ready, and grow — without taking on new loans.
Why Cash Flow is the Real Foundation in Construction
In the construction game, cash flow isn’t just about numbers — it’s your ability to move, hire, deliver, and grow. But with long payment cycles, material pre-orders, and rising labour costs, even profitable builders can feel squeezed.
If you’ve ever had to delay a job or dip into reserves while waiting to get paid — you’re not alone.
What is Invoice Factoring?
Invoice factoring helps you unlock the cash tied up in your unpaid invoices — fast.
It’s not a loan. Instead of borrowing money, you sell your invoices to a finance provider who gives you a large portion upfront. Once your client pays, you get the rest — minus a small fee.
How It Works (Step-by-Step)
You complete a job or milestone and issue an invoice
Submit that invoice to a factoring provider
Receive up to 90% of the invoice value within 24–48 hours
Your client pays the factoring provider directly
You receive the remaining balance minus a small fee
This gives you immediate access to working capital — without needing to chase clients or extend credit terms.
Why It Works So Well in Construction
Invoice factoring is a natural fit for the construction industry because it removes your biggest bottleneck: waiting to get paid.
Benefits for Builders, Subcontractors, and Tradies:
✅ No new debt — it’s not a loan
✅ Fast access to funds — usually within 1–2 days
✅ Smooths out cash flow between jobs or progress payments
✅ Lets you take on more work without straining resources
✅ Outsource collections — the factoring provider follows up on payments for you
When Should You Use Invoice Factoring?
It’s most useful when:
You’ve issued a large invoice and can’t afford to wait 30–90 days
You’ve won a big job but need cash upfront to mobilise
Your crew is sitting idle because of payment delays
You’re relying on cash from one project to fund the next
Real-World Example
A Melbourne-based fitout contractor secured a $320,000 job with a tier 2 builder. The first payment milestone was 45 days out. Rather than wait, they factored the invoice and accessed $272,000 (85%) within 48 hours — enough to order materials, pay trades, and keep timelines on track.
What Does It Cost?
Factoring fees usually range from 1% to 5% depending on:
The size of your invoice
Your client’s payment history
Your industry and frequency of use
Compared to the cost of pausing work, missing growth, or turning away jobs — many businesses see factoring as a flexible cash flow tool, not a cost.
Choosing the Right Factoring Partner
Not all finance providers understand the construction space. You want someone who knows:
🧱 Progress payments and staged invoicing
🧾 Retention clauses and client-side approval delays
🛠️ The urgency and reality of running a construction business
At Casey Asset Finance, we’ve already vetted many of the providers in the market. We’ll connect you with factoring options that are:
Transparent in fees
Fast in decision-making
Flexible on terms
Trusted by other builders
Is Invoice Factoring Right for Your Business?
It might be — especially if:
You work with large clients who take weeks to pay
You’re in growth mode and need reliable cash flow
You want to avoid taking on more debt
You’re sick of juggling jobs to stay liquid
You don’t have to guess. We can help you weigh the pros and cons, and show you how factoring would actually work for your business — no pressure, no obligation.
Final Word from Casey Asset Finance
In construction, momentum is everything. Invoice factoring helps you keep moving when payment terms slow you down.
It’s not about debt. It’s about getting paid faster for the work you’ve already done, so you can take on what’s next — with confidence.
Let’s Talk
Want to see how invoice factoring could help you finish stronger, grow faster, or take on more work — without borrowing a cent?
Reach out today. We’ll walk you through your options, answer your questions, and point you in the right direction.
Related Resources
How to Get a Business Loan for Construction in Australia
Single Invoice vs Invoice Facility: What’s Best for You?
