FAR 52.213-1—Fast Payment Procedure.
Plain-English Summary
FAR 52.213-1, Fast Payment Procedure, sets out a simplified payment method for certain small purchases and other eligible transactions by allowing the Government to pay based on shipment or delivery rather than waiting for full post-delivery verification. The clause covers when title passes to the Government, who bears the risk of loss or nonconforming supplies in transit, the contractor’s obligation to replace, repair, or correct defective or missing items, and the 180-day period during which the contracting officer may direct corrective action. It also addresses invoice preparation, including the required “FAST PAY” marking, treatment of transportation charges and parcel post insurance, retention of freight bills, and the information that must appear on invoices when a receiving report is required or not required. In addition, it explains the contractor’s certification when submitting an invoice and the requirement to mark outer shipping containers “FAST PAY.” In practice, this clause speeds cash flow for contractors and reduces administrative burden for the Government, but it also shifts significant shipment-risk and documentation responsibility to the contractor, so accurate shipping, invoicing, and packaging are critical.
Key Rules
Payment Based on Shipment
The Government may pay invoices when the contractor delivers supplies to a post office, common carrier, or, if shipped another way, to the Government’s first point of receipt. This is the core fast-payment concept: payment can occur before final destination receipt or full post-delivery processing.
Title Passes on Delivery
Title to the supplies passes to the Government at the moment of delivery to the carrier or first Government receipt point, depending on the shipping method. This timing matters because it determines when ownership transfers and when the contractor’s shipment-related obligations change.
Contractor Bears Transit Risk
Even though title passes early, the contractor remains responsible for supplies that are lost, damaged in transit, or not conforming to purchase requirements. The contractor must replace, repair, or correct the supplies at its own expense if the contracting officer directs it within 180 days after title vests in the Government.
Invoice Must Be Clearly Marked
The contractor must prepare the invoice as required by the contract and prominently mark it “FAST PAY.” If the invoice is not properly marked, the payment office may still accept it for fast payment, but if it declines, the invoice is processed under normal payment procedures.
Transportation Charges Must Be Shown Correctly
If the purchase price does not include transportation, the contractor must list prepaid shipping costs separately and may not include parcel post insurance. If transportation charges are shown separately, the contractor must keep the supporting freight or transportation bills for 3 years and provide them to the Government on request.
Receiving Report Information Required
If a receiving report is required, the contractor must either submit the prescribed receiving report with the invoice or include specified shipment and line-item data on the invoice, such as shipment number, mode of shipment, national stock number or manufacturer’s part number, unit of measure, ship-to point, mark-for point, and FEDSTRIP/MILSTRIP document number when applicable.
Additional Data When No Receiving Report
If no receiving report is required, the invoice must still include line-item information such as ship-to point, mark-for point, and FEDSTRIP/MILSTRIP document number if the contract requires it. The contractor must also include a copy of the invoice in each shipment.
Invoice Submission Certifies Compliance
By submitting the invoice, the contractor certifies that the supplies were shipped or delivered according to the ordering officer’s shipping instructions, in the quantities billed, and that the supplies conform in quantity and quality to the contract, order, or blanket purchase agreement.
Outer Containers Must Be Marked
The contractor must mark all outer shipping containers “FAST PAY.” If the marking is missing, the payment office may still make fast payment, but it is not required to do so and may instead process the invoice under normal procedures.
Responsibilities
Contracting Officer
Use the clause only when prescribed and, if nonconforming, damaged, or missing supplies are identified, direct the contractor to replace, repair, or correct them within 180 days after title passes. The contracting officer also relies on the invoice and shipping documentation to support fast payment and may need to resolve disputes if the payment office rejects fast payment.
Ordering Officer
Issue shipping instructions that the contractor must follow and, where applicable, ensure the contract or order identifies required receiving report and shipment data elements such as ship-to point, mark-for point, and document numbers.
Contractor
Ship supplies in accordance with instructions, prepare and mark invoices correctly, include required transportation and shipment data, retain freight bills when transportation is separately stated, mark outer containers “FAST PAY,” and bear the risk of loss or nonconformance until the Government receives conforming supplies at the applicable delivery point.
Payment Office
Process invoices for fast payment when the required conditions are met, but it may decline fast payment if the invoice or shipment documentation is insufficient or improperly marked. If fast payment is declined, it must pay the contractor under the normal invoice procedures applicable to non-fast-pay invoices.
Government Receiving Activity
Receive shipments, provide or support receiving report processing when required, and identify discrepancies or nonconforming supplies that may trigger contractor corrective obligations or affect payment processing.
Practical Implications
This clause can speed up cash flow, but only if the contractor’s invoice, container markings, and shipment documentation are complete and accurate. Missing “FAST PAY” markings or required line-item data can delay payment or push the invoice into normal processing.
The contractor should treat shipping accuracy as a payment issue, not just a logistics issue. Because title passes early but the contractor still bears transit risk and nonconformance risk, poor packaging, incorrect quantities, or weak carrier documentation can create direct replacement or repair costs.
If transportation is billed separately, the contractor must keep freight records for 3 years. Contractors that fail to retain those records may have trouble supporting charges if the Government asks for proof.
When a receiving report is required, the invoice must be aligned with the receiving documentation and contract data elements. Mismatches in shipment number, ship-to point, mark-for point, or document number are common reasons for payment office questions.
The 180-day correction window is important for both sides: the Government must act within that period if it wants the contractor to replace, repair, or correct supplies, and contractors should track shipment dates carefully to know when that exposure ends.
Official Regulatory Text
As prescribed in 13.404 , insert the following clause: Fast Payment Procedure (May 2006) (a) General . The Government will pay invoices based on the Contractor’s delivery to a post office or common carrier (or, if shipped by other means, to the point of first receipt by the Government). (b) Responsibility for supplies. (1) Titleto the supplies passes to the Government upon delivery to- (i) A post office or common carrier for shipment to the specific destination; or (ii) The point of first receipt by the Government, if shipment is by means other than Postal Service or common carrier. (2) Notwithstanding any other provision of the contract, order, or blanket purchase agreement, the Contractor shall- (i) Assume all responsibility and risk of loss for supplies not received at destination, damaged in transit, or not conforming to purchase requirements; and (ii) Replace, repair, or correct those supplies promptly at the Contractor’s expense, if instructed to do so by the Contracting Officer within 180 days from the date title to the supplies vests in the Government. (c) Preparation of invoice. (1) Upon delivery to a post office or common carrier (or, if shipped by other means, the point of first receipt by the Government), the Contractor shall- (i) Prepare an invoice as provided in this contract, order, or blanket purchase agreement; and (ii) Display prominently on the invoice "FAST PAY." Invoices not prominently marked "FAST PAY" via manual or electronic means may be accepted by the payment office for fast payment. If the payment office declines to make fast payment, the Contractor shall be paid in accordance with procedures applicable to invoices to which the Fast Payment clause does not apply. (2) If the purchase price excludes the cost of transportation, the Contractor shall enter the prepaid shipping cost on the invoice as a separate item. The Contractor shall not include the cost of parcel post insurance. If transportation charges are stated separately on the invoice, the Contractor shall retain related paid freight bills or other transportation billings paid separately for a period of 3 years and shall furnish the bills to the Government upon request. (3) If this contract, order, or blanket purchase agreement requires the preparation of a receiving report, the Contractor shall either- (i) Submit the receiving report on the prescribed form with the invoice; or (ii) Include the following information on the invoice: (A) Shipment number. (B) Mode of shipment. (C) At line item level- (1) National stock number and/or manufacturer’s part number; (2) Unit of measure; (3) Ship-To Point; (4) Mark-For Point, if in the contract; and (5) FEDSTRIP/MILSTRIP document number, if in the contract. (4) If this contract, order, or blanket purchase agreement does not require preparation of a receiving report on a prescribed form, the Contractor shall include on the invoice the following information at the line item level, in addition to that required in paragraph (c)(1) of this clause: (i) Ship-To Point. (ii) Mark-For Point. (iii) FEDSTRIP/MILSTRIP document number, if in the contract. (5) Where a receiving report is not required, the Contractor shall include a copy of the invoice in each shipment. (d) Certification of invoice . The Contractor certifies by submitting an invoice to the Government that the supplies being billed to the Government have been shipped or delivered in accordance with shipping instructions issued by the ordering officer, in the quantities shown on the invoice, and that the supplies are in the quantity and of the quality designated by the contract, order, or blanket purchase agreement. (e) FAST PAY container identification. The Contractorshall mark all outer shipping containers "FAST PAY" When outer shipping containers are not marked "FAST PAY," the payment office may make fast payment. If the payment office declines to make fast payment, the Contractor shall be paid in accordance with procedures applicable to invoices to which the Fast Payment clause does not apply. (End of clause)