For Louise Stewart, CEO and Founder of ProjectPay, ‘there is nothing more important’ than reversing the insolvency trend plaguing the construction industry when it comes to payments and cashflow.
Speaking to Payment Expert, Stewart shares why more and more businesses are collapsing due to payment rights for subcontractors and why this issue needs to be addressed with new, B2B payment rails before further harm can be caused.
Payment Expert: Could you share a brief description of Project Pay for those uninitiated?
Louise Stewart: ProjectPay is an award-winning, transformational construction payments platform built specifically for the industry to solve sector slow payment and cashflow challenges. By redefining B2B payments, we provide fast and guaranteed payments for a small transaction fee which is unheard of in the sector given skyrocketing construction insolvencies and bankruptcies.
ProjectPay seeks to eliminate both late payment and insolvency risks across project supply chains which enables us to provide our users with fast payments. There is no lending, there is no repayment by contractors or clawbacks to recoup from our contractor users.
The problem we solve is the gap between when work is completed and when they receive payment. It’s a big problem and one of the leading causes of business failure, which is magnified in the construction sector by risks associated with financial mismanagement, with smaller contractors relying on contractors above passing on timely payments to them received from their clients or project owners.
Typically payment times are not aligned between contractors in the supply chain and even though ‘paid when paid’ is outlawed, realistically, contractors are forced to wait until owners pay.
Unfortunately, larger contractors hold onto this payment to preserve their own working capital instead of passing on timely payments to their subcontractors who suffer the brunt of slow payments using inappropriate finance products, like high interest credit cards to solve their cashflow challenges and suffering losses when they don’t get paid due to upstream insolvencies which risks their financial viability.
PE: What are some of the current prevalent challenges people within the construction industry face when it comes to being paid?
LS: According to recently released figures from the Insolvency Service, there were 4,046 business collapses in the construction sector in the 12 months to February 2025. No one can operate a viable business in these conditions. Large main contractor collapses rob asset owners (clients), and speciality subcontractors, of their payment rights for work completed.
I am aware that some ISG subcontractors will likely lose their family homes due to the impact of ISG’s collapse having used the family home as security to be approved for a cashflow loan that they can now not repay. Others will be stuck paying off credit cards they used to fund work whilst they wait to be paid for work that they will never be paid for.
There is nothing more important to me than reversing this insolvency trend and making sure money owed to subcontractors and suppliers is protected from main contractor insolvency. Our platform delivers this and provides the necessary cashflow the sector requires to thrive.
PE: How much of a willingness have those within the construction industry shown when it comes to replacing outdated financial models in favour of newer, digital-based models?
LS: The industry has repeatedly been misled about what the crux of the problem actually is and therefore, what the best solution is to fix this long-standing payments and insolvency problem.
Digital-based models will do nothing to address the cashflow issues due to the mismanagement of payments in the sector. Although Project Bank Accounts were deemed to be the fix, multiple jurisdictions have already shown they are sub-optimal and ineffective and actually make the cashflow challenges worse. It’s unsurprising given all this that there are trust and cultural issues in the sector.
Offering contractors and subcontractors a low-cost payment platform that solves their biggest problem, cashflow, that completely eliminates financial mismanagement and insolvency risks to ensure that payments are guaranteed and fast, is transformational for them in being able to run viable businesses.
PE: How can construction companies in the UK also manage their cashflow procedures more efficiently?
LS: The first thing they must do is stop using high interest credit cards and loans to overcome cashflow issues as this gets them into a never-ending debt trap. Current finance products available are not a good fit for this sector given the slow payment and no payment risks.
ProjectPay offers fast and guaranteed payments for a small transaction fee. We also pay supplier invoices on projects, providing contractors with the vital working capital to get started on projects before they have been paid without having to resort to a high interest credit card that exposes them to losses.
We have eliminated the slow and no payment risks, when a payment entitlement is created on the platform they get paid instantly, they never have to pay the money back and are never charged interest. There is no liability on their businesses balance sheet, no debt is introduced into their capital structure, they just get the cash in the bank for the work they have completed. We collect repayment later directly from asset owners.
The platform automatically reconciles what has been paid out to subcontractors and suppliers on projects with what is owed to the main contractor. So when owners pay, they know their supply chain has already been paid, and funds have only been used to pay for the costs of delivering their project and nothing else.
PE: Are SME construction businesses also becoming more aware of the innovative alternative payment methods now being provided today, and do you have any use cases where Project Pay have helped in this regard?
LS: We are working with governments that are enforcing payment times across the entire supply chain. Before ProjectPay, they were using unreliable data to confirm payment times. What we found was, in reality, subcontractors were still not getting paid for 90+ days.
Now on ProjectPay, governments can see that the payment transaction has happened throughout the length of their supply chain, without the platform disclosing any commercial or confidential data. Now, contractors are demanding that all their projects use ProjectPay to pay them or they don’t accept contracts.
PE: How vital is it for smaller businesses to adopt a full range of digital payment methods in order to help scale their business while also retaining customers in the long-term?
LS: As highlighted, standard digital payments systems won’t help solve the sector problems of slow payment and non-payment as they misunderstand that the issue is about cashflow, not just payments.
By bringing the necessary cashflow, ProjectPay prevents financial misconduct or losses caused by insolvency or bankruptcy. New B2B technology payment rails have been implemented that removes that competition on funds flow.
Certainly, a platform like ProjectPay provides them with a proper end-to-end payment process to get their application-to–payments approved quickly so we can pay them and provide them with the necessary working capital to deliver on more and bigger projects. We also provide our users with vital payments coaching to make sure they are doing everything to help themselves to get paid faster.
PE: How beneficial would it be for the UK to further adopt instant, account-to-account payments and how could they revolutionise how construction, and all workers, send and receive their funds?
The UK already has account-to-account payments and is one of the most sophisticated banking tech sectors in the world. Most of the construction sector are already getting paid by instant digital funds transfer to their account, but it does nothing to solve specific construction sector payment challenges which are unique due to the hierarchy of payments in the industry and power imbalance between the parties.
Certainly, the sector should no longer be using cheques for payment and no contractor should accept payment by cheque as it can just be another excuse to delay payments. What would be transformational for the industry is to have the certainty of fast and guaranteed payments whereby slow and nonpayment risks are eliminated.
This way, they could really grow their businesses with confidence, and that is what ProjectPay provides.
