Invoice Financing / Factoring at First Citizens BancShares

Invoice financing and factoring provided by First Citizens BancShares are tailored financial solutions designed to convert outstanding accounts receivable into immediate working capital. These financing options help businesses stabilize cash flow, accelerate growth, and manage seasonal or cyclical demand without diluting equity or taking on long-term debt. Whether a company needs short-term liquidity to meet payroll, bridge supplier payments, or seize new opportunities, invoice financing and factoring provide flexible, practical alternatives to traditional lending.

What is Invoice Financing and Factoring?

Invoice financing commonly refers to lending against outstanding invoices, where a business retains control of its receivables while receiving a portion of their value as an advance. Factoring, by contrast, typically involves the sale of invoices to a factor who advances funds and assumes certain collection responsibilities. Both approaches unlock the value of billed but unpaid invoices, turning them into usable cash within days instead of waiting 30, 60, or 90 days for customer payment.

Key Features

• Fast access to funds: Advance rates that can deliver a significant portion of invoice value within 24–72 hours after submission and approval.
• Flexible advance structure: Options for single-invoice advances or ongoing lines of credit tied to eligible receivables.
• Recourse and non-recourse options: Choice between recourse factoring, where the client retains some credit risk, and non-recourse factoring, where credit risk is transferred subject to agreed terms and credit approvals.
• Customized credit review: Due diligence focused on the creditworthiness of invoice payers rather than solely on the borrower’s balance sheet.
• Integrated receivables management: Tools and services to streamline invoice submission, collections reporting, and reconciliation.
• Transparent fee structure: Competitive discount rates, service fees, and clear terms so businesses can model costs and benefits accurately.

Benefits for Your Business

• Improved cash flow and liquidity: Reduce cash conversion cycle and ensure predictable operating capital for payroll, inventory, and vendor obligations.
• Growth enablement: Use immediate funds to bid on larger contracts, scale production, or invest in sales and marketing without waiting for collections.
• Balance sheet management: Maintain borrowing capacity elsewhere by avoiding long-term debt and keeping financing activity focused on receivables.
• Credit management support: Leverage the factor’s experience in credit assessment and collections to reduce delinquency exposure.
• Operational efficiency: Reduce administrative burden by outsourcing collections and receivables processing where appropriate.

How It Works — Typical Workflow

1. Application and underwriting: Submit information on the business, customers, and invoices. Underwriting emphasizes customer credit profiles and invoice legitimacy.
2. Approval and facility setup: Establish advance rates, fee structure, and eligibility criteria for invoices. Determine whether recourse or non-recourse terms apply.
3. Invoice submission: Upload or present invoices for funding through a secure portal or by agreed submission process.
4. Advance disbursement: Receive an advance—typically a percentage of the invoice face value—within the agreed timeframe.
5. Collections and settlement: When invoices are paid by your customers, the factor reconciles payments, remits remaining balances after fees, or collects due funds if recourse applies.
6. Ongoing facility management: Adjust credit limits and advance capacity as sales volumes and customer credit profiles change.

Use Cases

Invoice financing and factoring are suitable for a broad range of industries, including manufacturing, wholesale and distribution, professional services, staffing, transportation and logistics, and business-to-business services. Typical scenarios include:

• New businesses with limited operating history seeking working capital against validated receivables.
• Rapidly growing companies requiring immediate funds to fuel expansion without diluting ownership.
• Businesses with long customer payment terms that want to smooth cash flow and improve vendor relationships.
• Companies preparing for seasonal peaks that need temporary liquidity to increase inventory and workforce levels.

Eligibility and Documentation

Eligibility considerations focus on the creditworthiness of invoice obligors, invoice aging, and the nature of goods or services provided. Typical documentation includes invoices, customer purchase orders, proof of delivery or service, and standard business identification documents. A streamlined onboarding process facilitates quick decisions and prompt access to funds.

Risk Management and Compliance

First Citizens BancShares emphasizes rigorous credit evaluation, compliance with relevant regulations, and robust fraud prevention protocols. Credit risk is assessed primarily at the obligor level, and controls are implemented to verify invoice authenticity. Contractual protections and clear recourse terms are provided to mitigate exposure where appropriate.

Operational Integration

The program supports integration with accounting and invoicing systems to automate invoice submission, status tracking, and reconciliations. Reporting dashboards provide visibility into advances, fees, collections, and outstanding receivables, enabling finance teams to manage cash flow proactively.

Choosing the Right Option

Selecting between invoice financing and factoring depends on your desired level of control over collections, appetite for credit risk transfer, and accounting preferences. Invoice financing may be preferable when maintaining customer relationships and collections processes is important. Factoring may suit companies that prefer to outsource collections and reduce administrative workload. Customized structures are available to meet specific business models and strategic goals.

Why Consider This Solution

Invoice financing and factoring with First Citizens BancShares are designed to be practical, transparent, and responsive to evolving business needs. By converting receivables into working capital, businesses gain flexibility to run operations, invest in growth, and manage unforeseen expenses. The combination of experienced underwriting, flexible terms, and integrated operational support makes this a compelling option for companies looking to optimize cash flow without making fundamental changes to their business structure.

If your organization is evaluating ways to accelerate cash flow, reduce days sales outstanding, or improve financial predictability, invoice financing and factoring represent proven, adaptable tools that align financing with sales activity. Careful structuring and ongoing management ensure the solution supports long-term objectives while addressing immediate liquidity needs.

Address Bank: Raleigh, North Carolina, U.S.
Bank: First Citizens BancShares
Headquarters: Raleigh
Products: Loans & Credit
Type: Invoice Financing / Factoring