Today we will look at the concept of prepayment recovery, which is an essential part of the payment recovery process. We will discuss its relevance to civil engineers, discuss the steps involved in the process, and consider the methods available for implementation. We hope that by the end of this article, civil engineers will have the knowledge and confidence to manage the process efficiently and accurately.
What is prepayment
It is a payment made before the start of the work or before the delivery of the work product. In construction, the contractor receives an advance payment to start the work after the acceptance letter is issued. Generally, the advance payment is 20% of the order value. However, this may vary from contract to contract.
It is a type of interest-free loan that the client grants to the contractor. To receive this payment, the contractor must provide a deposit.
Advance repayment method
- The deposit will be charged to contractors' invoices.
- Reimbursement occurs before the total payment amount reaches 90% of the contract value.
- The refund percentage for each invoice will be calculated accordingly.
- When the respective interim invoice is paid to the contractor, the advance payment is deducted.
The procedure for claiming the advance is in the Condition of Contracts . The specified procedure must be followed.
Disputes can occur in a variety of ways, including in court, through mediation or through arbitration. In most cases, it is best to try to recover the money through negotiation before taking more drastic measures.
If you are trying to get money back through trading, there are a few things you should keep in mind. First, it is important that you are clear about the amount owed. This means you must have a detailed invoice or contract detailing the services provided and the agreed price.
Secondly, it is important to be respectful and professional in all communications with the client or customer. Remember, they are under no obligation to pay, and threatening or aggressive behavior will only make the situation worse.
Finally, it is important that you remain reasonable in your demands. If you owe a large amount of money, it is unlikely that you will be able to recover the full amount immediately. It's important to be realistic with your expectations and negotiate a payment plan that is acceptable to both parties.
