The Tech Trying to End Construction’s 300-Year-Old Payment Problem

Why It Matters

By securing funds in a transparent, trust‑based system and providing upfront capital, the platforms could dramatically improve supplier resilience and reduce insolvency‑related losses across the construction supply chain.

Key Takeaways

• Saible uses DiPPA trust to separate cash and authority
• ProjectPay offers embedded finance, advancing payments before due
• Both platforms aim to reduce payment delays in construction
• Pilot with Environment Agency shows Saible gaining public‑sector traction
• Regulatory scrutiny remains key for third‑party payment solutions

Pulse Analysis

The construction industry has long struggled with delayed payments, a problem that dates back to the 18th century and was starkly highlighted by the collapses of Carillion and ISG. Traditional Project Bank Accounts (PBAs) often tie funds to the main contractor, leaving subcontractors exposed when insolvency strikes. As a result, many firms still rely on manual spreadsheets, creating opacity and increasing the risk of cash‑flow crises that can cripple small and medium‑sized enterprises.

Saible tackles this friction by introducing a Digital Parallel Payment Account (DiPPA), a trust‑held fund managed by Griffin Bank and regulated by the FCA. Unlike conventional PBAs, the DiPPA decouples cash deposits from payment authority, ensuring that each tier receives funds simultaneously once the required paperwork is uploaded. The platform charges a modest 0.25 percent fee to the project owner, while subcontractors pay nothing, and it streamlines onboarding by embedding due‑diligence into a single process. Recent pilots with the Environment Agency and contractor Bam Nuttall demonstrate early public‑sector adoption, suggesting that regulated trust structures can gain traction where traditional banking solutions have faltered.

ProjectPay adopts a different angle, embedding short‑term finance directly into its payment workflow. By advancing payments using capital or debt sourced from partner banks, the app lets subcontractors receive funds before the contractually scheduled date, charging a small transaction fee that covers the financing cost. Backed by £370,000 in Innovate UK grants, the solution addresses the industry’s biggest pain point—access to working capital—while assuming the risk of late or non‑payment. Adoption hurdles remain, including resistance from tier‑one contractors who profit from credit extensions and heightened regulatory scrutiny. Nonetheless, both Saible and ProjectPay illustrate how digital transparency and embedded finance could reshape construction cash‑flow management, offering a more resilient supply chain and potentially setting new standards for payment practices across the sector.