Construction Finance

Debtor Protection

Did you know that to recover a £25,000 bad debt a business with a 5% net margin would need to find an additional £500,000 in sales?

Debtor Protection is an optional service that works alongside a Construction Finance facility and helps reduce risk from late and non-payment of invoices to further protect your cashflow

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Key benefits of Debtor Protection

  • Icon of white process arrows going down a list of three tasks


    Cover against all or selective customers, UK or worldwide (subject to facility cover)

  • Star medal icon on an orange circle


    Access to a dedicated team who help make things seamless

  • Blue lighbulb icon on an orange circle


    In most cases we provide limit decisions within just 24 hours

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    24/7 online system accessible from anywhere to request limits

  • Enhanced

    Cover normally be backdated 60 days from sign up for enhanced protection

  • We're committed warm red icon


    Applications for Payment can normally be covered

Debtor Protection Key Facts – Construction Finance

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What is Debtor Protection?

Debtor Protection is an additional service provided by Ultimate Finance which seamlessly complements an existing Construction Finance facility and can help shield a business in the Construction industry from bad debts either as a result of a customer’s insolvency or protracted non-payment.

The main reason our clients choose to add this is for peace of mind when offering their customers credit terms. Debtor Protection can help prevent damages to cashflow and profitability.

At times of economic uncertainty and rising insolvencies, it makes good sense to protect what is often the largest asset on a business’ balance sheet – trade debtors.

Who is Debtor Protection for?

This particular form of Debtor Protection is for businesses in the Construction industry who trade with other businesses on credit and use Construction Finance as a funding line. It can be added to an existing facility, or started on the first day of a new facility.

How does Debtor Protection work?

Debtor Protection transfers the risk of non-payment to us and means that a business can confidently and safely extend credit to its customers knowing that invoices and applications for payment are protected should the worst happen.

There are two types of Debtor Protection: Selective Debtor Protection where the service only applies to a selected number of debtors subject to an agreed limit, and Whole Turnover Debtor Protection where the service applies to all debtors subject to an agreed limit.

Debtor Protection applies to invoices and application for payments that remain unpaid because of a debtor’s insolvency or protracted default. It normally pays 90% of the net value subject to a minimum retention of £1,000 or 10% whichever is greater.

What is not eligible for Debtor Protection with a Construction Finance facility?

  • Any debt which is not certified by Ultimate Finance on an independent third party as eligible debt for funding purposes
  • Any debt relating to a dispute that remains unresolved for more than 12 months after the original date of the application payment
  • Any debt related to Final Accounts or Retention Payments unless we have agreed this in writing in advance
  • Any taxes
  • Any contractual deductions including but not limited to disputes, counter claims and Pay Less Notices
  • Any contracts which include a “pay when paid” clause which enables a contractor to withhold payment in the event of insolvency
  • Any costs incurred prior to the commencement of a contract with a contractor
  • Works executed after a credit limit is reduced or withdrawn

Can a new client of Ultimate Finance receive Debtor Protection?

Normally, yes, and invoices or applications for payment raised in the 60 days prior to a facility starting may be covered at an additional cost and subject to the debt not being seriously overdue.

To ensure an invoice or application for payment is protected, a business will need to apply for limits which will be individually agreed via an online platform we provide access to. Limits are not guaranteed and are dependent on several factors. Limits should be requested and agreed in writing before goods and/or services are supplied, as failure to do so will likely mean there will not be any cover in place.

How much does Debtor Protection cost?

Debtor Protection is charged at a fixed percentage on a business’ ledger plus VAT depending on whether it is selective or whole turnover. All active limits are charged at a set fee per month plus VAT. Full details of charges are included within a business’ agreement with us.

What support is provided alongside the service?

In addition to the peace of mind Debtor Protection offers, Ultimate Finance also provides the support of a dedicated team on hand to help clients with any queries and access to a user-friendly online portal that can be accessed anytime, anywhere.

How to get started?

To find out more about Debtor Protection or add it to your existing facility, simply email our dedicated team via

Customer Success Stories

Discover how Debtor Protection has helped keep businesses moving

Let’s get things moving

If you would like to talk to us about any funding needs, call us on 0800 121 7757, register as an Introducer or request a quote for your business today