Checks may be going out of style with consumers, but they’re still going strong in the business sector — making up more than half of business-to-business payments, according to the Association for Financial Professionals’ Electronic Payments Survey. While preparing checks for deposit can be a significant drain on resources, recent advances in automation have made it easier to streamline receivables. With concerns about high labor costs and a rising-rate environment driving up the cost of borrowing, businesses are looking to lockbox collection services as a cashflow strategy.
With lockbox services, all receivables are routed to one central location where they are processed and automatically credited to your accounts. This reduces the need for your staff to open envelopes and prepare checks for deposit to the bank.
Efficiency through automation
Lockbox services help boost efficiency with the following benefits:
Is a lockbox right for you?
If you’re considering using lockbox services, start by evaluating your per-item cost for processing a payment internally. You are likely to find that lockbox services may offer greater payment processing efficiencies if you handle a high volume of checks or high dollar-amount checks.
If your company receives a high volume of low dollar checks, the task of preparing a pile of checks for deposit is time-consuming for employees. For organizations that receive a low volume of high dollar-amount checks, labor costs may not be an issue, but delays in processing large checks can be a drag on cash flow.
Ramp up your receivables
Take advantage of lockbox and other receivables solutions to streamline cash management and help your business run smoothly. Contact a business banker at (800) 355-0507 or visit a branch near you. [cite::171::cite] [cite::172::cite]