# Advance Payment in Construction

> An advance payment is money paid to a contractor before work starts, usually as a mobilisation advance. See an example and how RA bills recover it.

Canonical: https://superwise.site/glossary/advance-payment/
Last updated: 2026-11-01

Money paid to a contractor or supplier before work starts or material arrives, usually recovered later from running bills.

## What is Advance Payment?

An advance payment is a share of the contract value paid to a contractor or supplier before work starts or material is delivered. On works contracts it is usually called a mobilisation advance, and it gives the contractor cash to move equipment, set up the site or buy raw materials.

## Practical example

A developer awards a ₹1,00,00,000 contract for earthwork with a 10% mobilisation advance. The contractor receives ₹10,00,000 upfront to move excavators to the site and build labour camps. The developer then recovers the advance in proportion from later [RA bills](https://superwise.site/glossary/running-account-bill/).

## In SuperWise

In SuperWise a [work order](https://superwise.site/glossary/work-order/) carries the mobilisation amount agreed with the contractor. Each RA bill raised against it shows a mobilisation deduction, which recovers the advance, and the amount is recovered pro rata across bills or in one lump sum as the contract terms agree. A proposal can also record the advance a contractor asks for.

[RA bill software](https://superwise.site/features/ra-bill-certification/)

## Related terms

- [Running Account bill (RA bill)](https://superwise.site/glossary/running-account-bill/)
- [Work Order (WO)](https://superwise.site/glossary/work-order/)

## Related
- [Running Account bill (RA bill)](https://superwise.site/glossary/running-account-bill/)
- [Work Order (WO)](https://superwise.site/glossary/work-order/)
- [RA bill software](https://superwise.site/features/ra-bill-certification/)