Supply Chain Finance
Our supply chain finance solutions enable you to provide your key suppliers with an opportunity to sell their confirmed Accounts Receivable from you to Regions, at a discount.
Supply-chain finance programs are best suited for companies with:
- Investment-grade or near investment-grade credit profile
- $100 million in annual trade spend
Our confirmed supply chain finance facilities start at $15 million.
Here is how it works:
- An imbedded assumption in a Regions supply-chain finance program is that the supplier has a higher cost of borrowing than your company.
- You receive extended payment terms from key suppliers, and the suppliers receive cash immediately for selling the Accounts Receivable.
- The supplier benefits from a lower cost of capital by selling Accounts Receivable at a discount rate that is based on your credit profile instead of borrowing funds from their own bank.
Benefits of supply chain finance
- You reduce working-capital inefficiencies in the supply chain by allowing suppliers to receive earlier payments while extending your payment terms.
- It supports your effort to extend payment terms with suppliers, increase days-payable outstanding and lower working capital requirements.
- Suppliers get access to early-payment liquidity to accelerate the sales-to-cash cycle and decrease days sales outstanding, irrespective of commercial terms with their customer.
- In many cases, the discount rate carries a lower APR than a supplier’s alternative source of funds.
- The supplier can better manage credit risk and adhere to concentration limits from a specific customer by selling receivables to Regions on a nonrecourse basis.
Contact Regions Business Capital to explore a supply chain finance solution for your company.
Dan Wells
Managing Director
daniel.wells@regions.com