Lockbox banking, also known as remittance processing or remittance services, presents fantastic benefits to companies that receive numerous paper checks for accounts receivable every day. But it can be difficult to envision how a lockbox works and how it can boost your bottom line.

What is a lockbox?

Lockbox services help businesses with large volumes of checks streamline the receivables management process, improve access to funds and maximize cash flow. A lockbox directs a company’s mailed customer payments to a P.O. box, allowing the business’s bank to collect and then process payments on its behalf.

How does a lockbox payment work?

Once the bank collects the checks from the P.O. box, the envelope’s contents are extracted on automated equipment and fed through a high-speed scanner that captures images of the pieces and then converts and digitally stores account number, payment amount and other information from the images. Data is transmitted electronically to the company, and the money is deposited into customers’ accounts.

Take a look at this graphic below to get a better idea of what transpires with lockbox services and the advantages your business can enjoy. Faster access to your cash, increased employee efficiency, lower internal processing costs, greater security, better record keeping — these are the reasons why companies love lockbox banking.

Contact Cadence Bank today

You and your business are important to us at Cadence Bank. We take your financial success seriously, which is why we offer tools like Wholesale and Retail Lockbox, Remote Lockbox and eLockbox to help your business achieve its goals.

Find out more about Cadence Bank’s Receivables Management services and get in touch with us today.

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