Lockboxes allow organization to streamline receipts. When customers and business partners write you a check, you need to get those payments into the bank so that you can use the money. Lockbox services make that process more efficient than almost any business can hope for on its own.
Types of Lockbox Services
There are a variety of lockbox services available:
Why Would You Use a Lockbox?
The main reason to consider lockbox services is speed and efficiency. Lockbox services get money into your bank account faster than you’d be able to do it yourself. Perhaps you could run to the bank every time you got a check, but you wouldn’t be able to get much work done.
Note that these lockboxes may be located in places where the mail is delivered several times per day. Your offices probably only receive mail once each day. If a payment just misses delivery to your location, you’ll have to wait one business day to get your hands on the payment. In contrast, lockboxes offer more opportunities to capture payments and make deposits to your account.
Perhaps most importantly, you reduce the amount of time it takes for money to hit your accounts. You have less outstanding “float” money out there – customer payments get deposited and become available for use as quickly as possible.
Imaging and Lockboxes
Some banks offer image based lockbox services. Image based services scan everything that gets sent to your lockbox so that you can view it online. You can often see images from payments received on the same day they reached the lockbox.
As you might imagine, the ability to see the actual checks and envelopes that your customers send is priceless. You can respond to customer service inquiries, and you can resolve problems much more easily.
By using automation, banks can make your accounts receivable easier to manage. Optical Character Recognition (OCR) programs literally “read” everything and store the output electronically. This allows you to slice and dice your remittance data and, scroll through lists of customer information. In addition, having computers do the tedious work means that you’ll have less data entry errors – when the computers aren’t broken, of course.