Also called: Progress payment, Staged drawdown
Progressive draw
A progressive draw is the release of loan funds in stages as a project reaches agreed milestones, rather than as a single advance. It is standard in construction and development lending and in some large equipment builds.
What is a progressive draw?
A progressive draw is the release of loan funds in stages as a project reaches agreed milestones, rather than as a single advance. It is standard in construction and development lending and in some large equipment builds.
Example
A build is funded across five draws — slab, frame, lock-up, fit-out and completion — each released after inspection.
Why it matters
Interest accrues only on funds drawn, but each draw needs documentation and often a quantity surveyor sign-off.