Prompt payment statutes are laws that require the payment of contractors and subcontractors within a certain period of time, and prescribe interest and penalties for late payments. In some states these laws only apply to public works construction projects that are funded by the government—and sometimes only to public works projects over a certain dollar amount. There is also a federal Prompt Payment Act for federal construction projects.

In New Mexico, prompt payment statutes are designed to ensure that contractors and subcontractors are paid in a timely manner for their work on construction projects. These laws apply to both public and private construction projects. Under the New Mexico Prompt Payment Act, payments to contractors on public works projects must generally be made within 30 days after the public entity receives an undisputed request for payment. Contractors must then pay their subcontractors within seven days of receiving payment. For private projects, the owner must pay the contractor within 21 days after the contractor's request for payment, and the contractor must pay the subcontractor within seven days of receipt. If payments are not made within these time frames, interest penalties may apply. The rates and terms of these penalties are specified in the statute. Additionally, the federal Prompt Payment Act covers federal construction projects, requiring federal agencies to pay contractors within a specific time frame and to include prompt payment terms in their contracts.