2 min read
How retentions work
A retention is a percentage (often 5%) withheld from each payment as security that the work is completed properly, released after a defined period. It is common in construction and larger contracts, and it locks up cash you have earned.
Managing the impact
Track retentions carefully so you know what is owed and when, chase their release on time, and factor the delay into your forecast. Short-term finance can bridge the cash held in retentions if it strains you.
What it means for you
Credicorp lends to your company, not to you personally, and takes no personal guarantee. See business loans or apply online.
Frequently asked questions
Why do clients hold retentions?
As security that the work is completed and any defects are put right. It is standard in construction and large contracts, but it does tie up cash you have already earned.
Can I finance against retentions?
The delay in retention release can be bridged with short-term finance, so cash held back does not strain your operations while you wait for sign-off.
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Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.