How To Accept Payments For A Construction

A construction business is paid last in a chain where everyone else is paid first: materials on delivery, subcontractors on their terms, labour weekly, and the client on a progress schedule that may run thirty or sixty days behind the work. Managing that gap is the trade's central financial skill, and the payment setup either supports it or makes it worse.

Reviewed July 28, 2026. Every figure below links to its source.

How construction money actually arrives

Four flows. Deposits at contract signing, funding mobilisation and early materials. Progress payments against a schedule of values, billed as work completes rather than on a calendar. Change orders for scope beyond the contract, which is where the largest disputes and the largest unbilled losses both live. And final payment plus any retainage released at completion, often the hardest money in the job to collect. Materials and subcontractors are paid throughout, ahead of most of it.

By the numbers (July 28, 2026)

Rate that applies: 3.3% + 30¢ online or on a card-paid invoice, per Square's 2026 US pricing. On a $28,000 progress payment that is $924. The ACH route, 1% with a $10 ceiling, costs $10.00 and keeps $914. At progress-payment scale the rail choice is a line item in its own right, which is why bank details belong on every application for payment.

The schedule of values, which governs everything

Progress billing works when the contract defines exactly what percentage completion earns what payment, and fails when it says the job will be billed periodically. Break the contract into line items with values, bill against completed items with documentation, and submit on the same day each cycle so the client's process becomes predictable. A contractor billing clearly and consistently is paid faster than one billing accurately but erratically, because construction payments move through approval chains that reward legibility.

Change orders in writing, before the work

This is the single most expensive habit in the industry. A client asks for something extra, the crew does it because stopping costs a day, and the amount is raised at the end when goodwill is thin and memory is contested. Write it down: scope, price, schedule impact, signed before the work proceeds. It feels bureaucratic on a small change and it is the reason some contractors finish jobs at their margin while others finish at cost. On larger projects, applicable contract and lien rules for your area create specific procedures worth following exactly.

Deposits, mobilisation, and who is financing whom

A contractor who buys materials, pays a crew, and bills thirty days later is lending the client money at their own cost. The deposit exists to prevent that, sized to cover mobilisation and the first material order rather than to be a token. Where applicable rules limit deposit amounts for residential work in your jurisdiction, follow them, and structure early progress payments to close the gap instead. The principle stands: no significant unfunded position, at any point in the job.

Retainage, final payment, and the rails

Retainage held until completion is normal and its release is routinely slow, so track it as a receivable from the day it is withheld rather than remembering it at the end. Punch list completion should be documented and signed, because final payment is most often delayed over items nobody wrote down. On rails: card suits deposits and smaller residential jobs, while progress payments at four and five figures belong on bank transfer, and the difference at construction ticket sizes is genuine money rather than a rounding error.

Sources

• Swipesum — Square Fees Explained 2026 (verified against Square's published pricing)
• NerdWallet — Square Fees: Calculator and Pricing for 2026

What people ask me

How should construction progress payments be structured?

Against a schedule of values that defines what percentage completion earns what payment, billed with documentation on the same day each cycle so the client's approval process becomes predictable.

Why do change orders matter so much?

Because unwritten extras are raised at the end when goodwill is thin and memory is contested. Scope, price, and schedule impact signed before the work is what protects margin.

What is the deposit actually for?

Covering mobilisation and the first material order, so the contractor is not lending the client money by buying materials and paying crews before billing.

How should retainage be handled?

Tracked as a receivable from the day it is withheld, with punch list completion documented and signed, since final payment is usually delayed over undocumented items.

Which rail suits construction payments?

Card for deposits and smaller residential work; bank transfer for four and five figure progress payments, where the fee difference is genuine money.

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