Prompt Payment
In 1982, Congress passed the Prompt Payment Act to require Federal agencies to pay their bills on a timely basis; to pay interest penalties when payments are made late, and to take discounts.
What happens if a payment is late?
In most cases, when an agency pays a vendor late, the agency must pay interest.
Current Rate
The Prompt Payment interest rate for July 1–December 31, 2025 is 4.625%.
Prompt Payment Calculators
To determine the amount of interest, use the Prompt Payment interest calculator.
Paying Credit Card Bill
A credit card bill is different from the vendor invoices we are covering on this page.
If a vendor submits a proper and valid invoice to the right people in a federal agency, the agency must pay the invoice on time. If not, the payment is late.
For more questions and answers see the Frequently Asked Questions.
May an agency pay early?
A vendor may offer the agency a discount if the agency pays within a specified shorter time.
To determine the amount to pay with the discount, use the Prompt Payment discount calculator.
Accelerated payments. Agencies should pay vendors early in these cases:
- The agency has received a proper invoice, and
- It is in the best interest of the government, and
- Any one of these 3 conditions is true:
- The invoice is under $2,500, or
- The payment is to a small business, or
- The payment is related to an emergency, disaster, or military deployment
Download the Prompt Payment Act
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EARLY PAYMENTS ON-TIME AND LATE PAYMENTSResources
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