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What Is the Meaning of an Interim Payment?

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An interim payment is a sum of money paid to a person or company in anticipation of a decision on a final payment total. The idea is to partially satisfy a financial obligation. Interim payments help a creditor fill a gap during which it would not receive compensation. An interim payment should be followed by another payment that completes a compensation agreement.

Interim Examples

Interim payments are common when federal employees retire, according to FedSmith.com, an information site for federal workers. It can take several months to finalize the details of a pension payout, so interim payments fill the income void until an agreement is reached. Insurance companies also make interim payments on policy claims as they complete due diligence and processing.

About the Author

Neil Kokemuller has been an active business, finance and education writer and content media website developer since 2007. He has been a college marketing professor since 2004. Kokemuller has additional professional experience in marketing, retail and small business. He holds a Master of Business Administration from Iowa State University.

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