IPEX PAYMENT
FRAMEWORK: SUMMARY

IPEX PAYMENT
FRAMEWORK: SUMMARY

WHAT IS IPEX?

IPEX is an online payment platform that secures funds intended for a project, protecting Developers and Sub-Contractors in the event of Builder insolvency.

IPEX software integrates with a dedicated construction project bank account to ensure that progress payments are used only to pay approved Sub-Contractors & Suppliers linked to that specific project. IPEX provides Developers with visibility over who has been paid & when, without sharing a Builders’ commercially sensitive information.

Whilst IPEX protects Developer & Sub-Contractor payments, it also helps financially secure Builders to validate their money management practices, differentiating their bid from competitors in the process.

Read all about the conditions and benefits of the IPEX Framework by downloading PDF below.

Register as an ‘ipex ready’ builder

Register for invitations to work on upcoming Projects using IPEX Developers are now specifying IPEX on future projects & are looking for Builders who are willing & able to operate within the IPEX framework.
If you’d like IPEX to promote your business to our Developer network, please review the IPEX Framework below and confirm that you are ‘IPEX Ready’.

IPEX PAYMENT FRAMEWORK

Read all about the conditions and benefits of the IPEX Framework below.


As a condition of winning the contract, the Builder accepts that:

  • funds received for work completed on the project are held in trust & can only be used for the payment of verified Sub-Contractors & Suppliers linked to the project
  • Builder entitlements are received via automatic payment of an agreed percentage of all payments made to verified Sub-Contractors/Suppliers and/or by making a ‘Withdraw’ request for any costs/entitlements approved by QS but not covered by agreed margin percentage: sample IPEX implementation models can be viewed and downloaded here
  • the Developer will have visibility over which Sub-Contractors/Suppliers have been paid & when (values only if via Builder agreement)*
  • should they enter administration or otherwise fail to arrange for the distribution of funds in accordance with set terms, the Developer has the right to remove the Builder as trustee & appoint themselves, entitling them to make payment directly to Sub-Contractors & Suppliers

Contact IPEX to review the IPEX Terms & Conditions



Whilst IPEX does place certain limitations on how progress payments can be used, it also provides significant advantages to financially secure, responsibly managed Builders including: 

  • confirms to Developers & Lenders that you have no intention or need to divert funds to other projects
  • actively deters Builders in financial difficulty from tendering
  • helps to differentiate your bid from non-IPEX capable tenderers by offering a level of transparency & security others can’t
  • lowers risk of non-payment for Sub-Contractors & Suppliers, building trust & encouraging more favourable pricing/terms for Builders
  • aids Builder compliance with Building Industry Fairness (BIF) Act, QBCC & other state project trust & retention trust legislation
  • opens up the potential to leverage IPEX security/transparency to negotiate better commercial terms, helping to reach a cash positive position earlier in the project

* Developer will only be able to view exact amounts paid to Sub-Contractors/Suppliers if a) the Builder opts to allow this and/or b) the Builder becomes insolvent whereby ownership of the project trust account is transferred to the Developer.
** Please note, download contains IPEX ‘suggested’ clause wording. Your Developer may adjust this clause at their discretion.
*** Not an IPEX feature; Given the additional protection IPEX brings, some Developers have also indicated a willingness to move on other contractual/payment terms to their Builders advantage. All contract terms/payment conditions are to be negotiated/agreed between the Developer & Builder.

Register as an ‘ipex ready’ builder

When you register your business as ‘IPEX Ready’, your business will be actively promoted to our Developer network. Developers will use the ‘IPEX Ready’ Builder Directory to identify/invite suitable Builders to tender on upcoming ‘IPEX’ projects.

Registering your business is FREE & does not mean you must use IPEX on every project.

PROCESS STEPS: WORKING WITHIN THE IPEX PAYMENT FRAMEWORK

When you register your business as ‘IPEX Ready’, your business will be actively promoted to our Developer network. Developers will use the ‘IPEX Ready’ Builder Directory to identify/invite suitable Builders to tender on upcoming ‘IPEX’ projects.

Registering your business is FREE & does not mean you must use IPEX on every project.

 


    1. The successful Builder will be directed to the IPEX website to create an IPEX account and login.  IPEX will then assist the Builder to open up a project trust account facility with Macquarie Bank for the purposes of receiving & distributing all project related payments (this is a one-off process). The project trust account must be opened prior to site establishment.

    2. The Builder will be provided with the IPEX Sub-Contractor clause, to be included in all Sub-Contractor
      agreements linked to the project. Supply-only agreements are not subject to IPEX Clause.

    3. The Builder will add awarded Sub-Contractors & Suppliers to the project within the IPEX Builder portal. IPEX will send onboarding information to all linked Sub-Contractors & Suppliers; they must register with IPEX before any payment can be made. An IPEX Account Manager will be available to assist in completing this process.

    4. As part of initial onboarding, all Sub-Contractors & Suppliers will be subject to verification via KYC/AML* protocols. Once verified, these Sub-Contractors & Suppliers can be added to future projects by the Builder without this step being repeated.  

    5. Sub-Contractors & Suppliers may also be contacted by IPEX representatives to assist in finalising this process.



    1. The process by which the Builder requests a progress payment remains unchanged. All standard QS approval checks & processes undertaken prior to payment approval also remain unchanged. 

    2. Once the progress claim is approved, the Developer will deposit the progress payment into the Macquarie Bank project trust account linked to the project. 

    3. The Builder will be alerted once transferred funds have cleared & are ready for use.



    1. The process by which the Builder processes Sub-Contractor & Supplier payments is unchanged. Builders upload payment file from their accounting software directly into IPEX platform for payment. 

    2. The Sub-Contractor will be alerted once they have been paid.

    3. There are 2 ways Builders can receive their entitlements:

      a) Via automatic payment of an agreed percentage of all payments they make to verified Sub-Contractors & Suppliers through IPEX. For example, if the agreed margin is 10%, the Builder will automatically be paid $10K for every $100K paid to Sub-Contractors/Suppliers

      b) Via ‘Withdraw’ request; the Builder may submit a claim to the Developer for costs/entitlements approved by QS but not covered via the agreed margin method including preliminaries, material deposits and/or additional margins – claims may require substantiation (dependant on Developer expectations/requirements)

      There is no ‘standard’ IPEX implementation method; all processes regarding Builder payment & Developer/Lender transparency levels to be agreed between Developer & Builder on a project-by-project basis: sample IPEX implementation models can be viewed here

    4. Should the Builder have preliminary costs approved by QS but not associated with a sub-contractor payment,
      these can be claimed in full via the IPEX ‘redraw’ function within the Builder portal. 

    5. Sub-Contractor retention funds will also be automatically set aside in the Retention Account.


*KYC: Know Your Client / AML: Anti-Money Laundering

IS YOUR BUSINESS ‘IPEX READY’?

Let IPEX promote you to our network of Developers

WHO WE WORK WITH

CASE STUDIES

Learn more about IPEX