2 min read
Definition
A deposit is a payment taken before work begins, funding the initial outlay and confirming the customer's commitment. Taking a deposit shifts the funding of the riskiest, most cash-hungry early phase of a job onto the customer.
In plain terms
A percentage up front covers your first spend on materials and mobilisation, so you are not financing the start of the job from your own cash. It also filters out non-serious customers.
Why it matters
Deposits directly shrink the cash gap on larger work and reduce risk. See stage payment and how to take deposits.
Related reading
Stage payment
A stage payment is a payment made at a defined point in a project, rather than all at the end — for example…
Read →
Pro-forma invoice
A pro-forma invoice is a preliminary bill sent before goods or services are supplied, typically to request…
Read →Milestone billing
Milestone billing is invoicing a customer at pre-agreed points in a project as each milestone is reached,…
Read →
Acceleration (loan)
Acceleration is a lender demanding the whole balance at once after a default — the clause that turns a…
Read →Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.