Riverchain unlocks US$10m to finance Hong Kong construction receivables

Hong Kong working-capital finance provider Riverchain has secured a US$10m funding commitment from dLab Asset Management, creating additional capacity to finance construction receivables through an institutionally backed origination and servicing platform.

Announced on 28 October, the agreement will allow Riverchain to source, underwrite and service financing assets generated by contractors and subcontractors, with dLab providing funding against eligible transactions.

The arrangement targets a persistent liquidity problem in construction, where contractors frequently incur expenditure on materials, labour and subcontracted services before receiving payment for completed work.

Payment cycles can be complicated by project certification, contractual milestones and the financial position of counterparties, creating working-capital requirements that conventional corporate lending may not fully address.

Riverchain specialises in financing solutions tailored to these conditions, including factoring, invoice finance and cash-flow-based lending.

Under the new arrangement, the company will operate an origination-as-a-service model, using project and payment information to assess eligible financing opportunities and manage the underlying receivables.

dLab, a Hong Kong investment manager licensed by the Securities and Futures Commission, will provide institutional capital through its data-driven SME financing strategy.

The structure separates loan origination and servicing from the institutional capital supporting the assets, potentially allowing Riverchain to expand financing volumes without funding every transaction from its own balance sheet.

This distinction is important for specialist receivables finance providers. Access to external institutional funding can increase origination capacity while allowing the platform to concentrate on underwriting, collection management and transaction monitoring.

Construction receivables introduce risks that differ from conventional trade invoices, including disputes over work completion, certification delays, retention arrangements and contractor concentration.

The quality of the underwriting process and enforceability of underlying payment obligations will therefore be central to the programme’s performance.

The companies have not disclosed the facility’s pricing, maturity, recourse arrangements, eligibility criteria or whether the entire US$10m has been made available for immediate deployment.

The announcement establishes a funding commitment rather than confirming that US$10m of receivables has already been purchased or financed.

For Hong Kong’s construction-finance market, the agreement adds a new institutional funding channel to a sector where access to liquidity can depend as much on individual project cash flows as on the borrower’s overall financial position.