Invoice Financing / Factoring at First Horizon National Corporation

First Horizon National Corporation offers invoice financing and factoring solutions designed to convert outstanding accounts receivable into immediate working capital. These financial products help businesses stabilize cash flow, accelerate growth, and meet short-term obligations without waiting for customer payment cycles to complete. Whether a company is seeking flexible liquidity to support seasonal demand, fund new contracts, or smooth payroll and supplier payments, invoice financing and factoring provide practical alternatives to traditional loans.

What is Invoice Financing and Factoring?

Invoice financing is a financing arrangement where a business borrows money against the amounts due from customers. Factoring is a specific form of invoice financing in which a company sells its invoices to a financier at a discount in exchange for immediate funds and optional ongoing receivables management. Both solutions free up capital tied in accounts receivable and convert unpaid invoices into usable cash, enabling better working capital management and operational flexibility.

Key Features and Benefits

• Improved Cash Flow: Access immediate funds to cover operating expenses, payroll, inventory purchases, and growth initiatives rather than waiting 30–120+ days for invoice payments.
• Flexible Funding: Financing lines often grow with the business; as sales and receivables increase, available financing capacity can expand accordingly.
• Speed of Access: Fast approval and funding cycles reduce disruption—funds can often be advanced within days after onboarding.
• Reduced Credit Risk Options: Choose between recourse and non-recourse factoring models depending on the appetite for credit risk and pricing sensitivity.
• Working Capital Predictability: Convert variable receivable cycles into reliable cash flow, improving budgeting and planning.
• Receivables Management: Optional services include invoice processing, collections support, and credit checking of customers to streamline administration.
• Customizable Structures: Programs can be tailored to industry specifics, customer concentrations, and seasonal patterns.

How It Works — Typical Process

1. Assessment: First Horizon reviews the creditworthiness of a business’s customers, invoice quality, and receivable patterns.
2. Agreement: A factoring or invoice financing agreement outlines advance rates, fee schedules, and program terms, including whether the arrangement is recourse or non-recourse.
3. Funding: Once approved, the financier advances a percentage of approved invoices—commonly between 70% and 90%—to the business.
4. Collections: Customers pay the factor directly (in an assigned receivables model) or pay the business, which remits proceeds (in a borrowing base model), depending on the program.
5. Final Settlement: After the invoice is paid, the remaining balance is remitted to the business, less the agreed fees and any reserve amounts.

Types of Programs

• Recourse Factoring: The business remains ultimately responsible if a customer fails to pay, typically resulting in lower fees.
• Non-Recourse Factoring: The factor assumes credit risk for approved customers, offering greater protection though usually at higher costs.
• Selective or Single-Invoice Financing: Finance specific invoices rather than the entire receivables ledger—suitable for spot needs.
• Full-Service Factoring: Includes receivables management and collection services, reducing administrative burden for the seller.
• Confidential/Wholesale Financing: Designed to be less visible to buyers, maintaining the seller’s relationship while providing liquidity.

Who Benefits Most

Invoice financing and factoring are especially valuable for businesses that operate on net-30, net-60, or longer terms, or for companies experiencing rapid growth, seasonality, or cyclical cash flow pressure. Typical industries that benefit include manufacturing, wholesale and distribution, staffing and payroll services, transportation and logistics, construction subcontractors, and business-to-business service providers.

Eligibility and Documentation

Eligibility is commonly based on the credit quality of a business’s customers, the age and quality of receivables, and the seller’s operational track record. Documentation requirements generally include accounts receivable aging reports, copies of invoices, customer contracts or purchase orders, business financial statements, and identification documents for company principals. First Horizon works with clients to streamline the onboarding process and provide clear documentation checklists.

Pricing and Transparency

Pricing depends on factors such as program structure (recourse vs non-recourse), customer credit risk, average invoice size and age, industry risk, and volume. Fees typically include an advance fee or discount rate applied to financed invoices and may include additional administrative or servicing fees. First Horizon emphasizes transparent fee disclosure and works to align program terms with a client’s cash flow objectives and cost expectations.

Risk Management and Compliance

Sound risk management practices are integral to invoice financing. First Horizon employs robust credit assessments, ongoing receivables monitoring, fraud detection measures, and compliance frameworks to protect both its clients and its own interests. Programs are structured to comply with applicable regulatory requirements and to maintain best practices in data protection and transaction security.

Integration and Technology

Seamless integration with accounting systems and invoicing platforms enhances efficiency. First Horizon’s financing solutions can be tailored to work with common accounting software and electronic invoicing systems, enabling automated submission of invoices, real-time reporting, and streamlined reconciliation. This integration reduces administrative overhead and accelerates funding cycles.

Support and Relationship Management

Clients receive dedicated relationship support to navigate program setup, onboarding, and ongoing management. Relationship managers provide guidance on optimizing funding structures, managing customer credit exposures, and scaling facilities as business needs evolve. Operational teams coordinate collections, reporting, and any additional services such as payroll funding or supply chain support when required.

Choosing an Invoice Financing Partner

When selecting a financing partner, businesses should evaluate underwriting criteria, funding speed, fee transparency, service levels, technology integration, and the provider’s experience within their industry. A strong partner balances competitive pricing with flexible program design, reliable funding, and responsive client service.

Conclusion

Invoice financing and factoring from First Horizon National Corporation provide practical, scalable solutions to convert receivables into working capital. With customizable program structures, attentive relationship management, and a focus on transparent pricing and risk control, these products help businesses maintain liquidity, support growth initiatives, and simplify receivables administration. For companies seeking to stabilize cash flow, accelerate growth, or reduce administrative burden, invoice financing and factoring offer compelling alternatives to traditional debt, enabling smarter cash management and operational resilience.

Address Bank: Memphis, Tennessee, U.S.
Bank: First Horizon National Corporation
Headquarters: Memphis
Products: Loans & Credit
Type: Invoice Financing / Factoring