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GLOSSARYTERMS AS A CREDIT DESK USES THEM

Progress claim (payment claim)

What is a progress claim, and why is it a hard receivable to lend against?

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BY MICHAEL SHANG · SIXTEEN YEARS IN COMMERCIAL BANKING · UPDATED

// THE SHORT ANSWER

A progress claim is a contractor's periodic invoice for the work done on a construction contract to date, usually checked and certified by the principal's quantity surveyor or engineer before it is paid. Statutes in New Zealand, Australia and the UK give these claims a fast payment and adjudication process. A lender to a contractor still reads them as softer than ordinary receivables: a claim can be cut back on certification, retentions are held back, and the principal may set off claims for delay or defects, so financiers often exclude progress claims from a borrowing base or advance against them at a lower rate.

BASIS  Practitioner judgment from sixteen years in commercial banking, set out in How Bankers Think (Highbank Press, 2026). Every borrower on this site is a composite constructed for teaching, not a client. The market is mid-market commercial lending as practised in New Zealand and Australia; where a convention differs elsewhere, the page says so.

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