Works-in-Progress Finance in Australia 2025: Funding Your Next Project

Works-in-progress (WIP) finance is rapidly emerging as a lifeline for Australian businesses managing complex projects in 2025. Whether you’re a builder awaiting milestone payments or a manufacturer scaling up production, understanding how to leverage WIP funding could be the difference between a stalled project and a successful delivery.

Why Works-in-Progress Finance Matters in 2025

With Australia’s infrastructure pipeline at record highs and the economy experiencing a sharp rebound in the wake of 2024’s policy reforms, more businesses are juggling multiple large-scale projects. Cash flow bottlenecks remain a top concern, especially in construction, manufacturing, and tech development. Works-in-progress finance offers tailored funding that matches the unique cash flow cycle of each project, helping businesses:

• Bridge the gap between upfront expenses and milestone payments
• Mitigate the risks of project delays or cost overruns
• Take on more ambitious contracts without overextending resources

For example, the 2025 Federal Budget’s $15 billion boost for green infrastructure is driving a surge in renewable energy projects, many of which require staged payments and specialised equipment procurement. WIP finance solutions are helping contractors and suppliers stay agile as they compete for government tenders and private contracts.

How WIP Finance Works: Structures and Strategies

Unlike traditional loans, WIP finance is structured around the progress and value of your ongoing projects. Lenders assess the percentage of work completed, certified invoices, and future cash flow projections. The most common structures include:

• Progress Claim Financing: Advance funding based on certified progress claims, popular in construction and civil works.
• Invoice Discounting: Early access to funds locked in pending invoices, ideal for suppliers and subcontractors.
• Project-Based Lines of Credit: Flexible credit tied to project milestones, often used in tech and manufacturing rollouts.

In 2025, major Australian banks and alternative lenders have rolled out new digital assessment tools that speed up approvals and provide real-time project monitoring. These tools leverage open banking data and AI-driven risk modelling, giving lenders greater confidence to fund projects mid-stream—even in volatile sectors.

Risk Management and Compliance: What’s Changed in 2025

Regulatory scrutiny has tightened in response to a spate of high-profile project collapses in 2024. The Australian Prudential Regulation Authority (APRA) now requires lenders to conduct enhanced due diligence on WIP finance applications, focusing on:

• Accurate and up-to-date project documentation
• Robust cost control and risk mitigation plans
• Transparent reporting of project changes and delays

For borrowers, this means keeping meticulous records and demonstrating a clear pathway to project completion. Some lenders are also embedding environmental, social, and governance (ESG) criteria into their WIP finance products, particularly for government-backed and infrastructure projects.

Real-world Example: A Queensland civil engineering firm recently secured $8 million in WIP finance to accelerate work on a new regional transport corridor. By linking funding tranches to independently verified milestones, the company was able to manage subcontractor payments and absorb unforeseen supply chain shocks—delivering the project ahead of schedule and under budget.

Is WIP Finance Right for Your Business?

Works-in-progress finance isn’t a one-size-fits-all solution. It’s best suited for businesses with:

• Long project cycles with staged payments
• Strong project management frameworks
• Clear visibility over future receivables

With lenders offering more flexible and innovative products in 2025, even smaller operators can access WIP funding—provided they meet the latest compliance standards and have a track record of successful project delivery.