A Business Encyclopedia

Lockbox Banking

Definition: The Lockbox Banking is the service offered by the commercial banks to the companies wherein, the payment made by the customers is directed to the special post office box rather than to the company.

Under the lockbox banking system, the company opens up a lockbox account with a bank, which is generally at the central location, easily accessible to the bank. The box is emptied several times in a day, and as the money receipts are collected, the bank deposits the same into the company’s account and inform about it to the company via electronic data transmission.

lockbox banking
Through lockbox banking, the company’s burden of accepting mails and the payments from the customers has reduced drastically. And with time to time updations from the bank, a company can put money in the work as soon as it is received.

But however, there is a fear that the bank employees who have access to the lockbox can commit a fraud. The fraud can be in the form of check counterfeiting as the checks in the lockbox contains all the information sufficient to make a check counterfeit. To overcome this limitation, the company must choose a bank which they trust and should keep a regular check on the lockboxes.

Leave a Reply

Your email address will not be published. Required fields are marked *


Related pages

meaning of ethnocentric approachspearman coefficient correlationmeaning autocraticreinforcements meaningteleological definewhat does moratorium meanmeaning of homogeneous in hindiexample of diminishing marginal utilityvariate definitionexposure in hindidefinition of fixed cost in economicswhat is a monopolistic competitionwalter dividend modellaissez faire meanretrenchment in strategic managementmeaning of turnover ratiomicroenvironment and macro environment in marketingseasonal unemployment defineapproaches to collective bargainingsteps of capital budgeting processwhat is a profitability indexscales defmarket audit definitionwhat is meant by skimmingmargin lending definitiondemand forecasting in managerial economicsmeaning of poachermeaning of bargain in hindicharacteristics of oligopoly market structuretwo way symmetrical public relationserg theory clayton alderfermcclelland's needs theorytraditional e commerce definitionpert planninglaser faire definitionemployee referral meaningdual of linear programsustitution methodfeatures of duopolydefinition of repo rate and reverse repo rategreenmailvertical retailer definitiontraining meaning in hrmoperating lease and finance leaseteleological ethics definitionindustrial relation in hrdecentralised definitionoperating lease finance leasemeaning of formal communicationmicroenvironment marketingdefinition franchisingsales forecasting definitiondiminishing marginal benefitmarketing microenvironmentinternationalisation meaningjob rotation and job enrichmenttheory of motivation pptpeak load pricing examplemeaning of innovative in hinditeleological systemsdemand projection formulachronically unemployed definitionmonopolistic competitive market structuredemand-pull inflation isapproaches of collective bargaining pdfdifference between forwards and futuresdefine sociocultural factorsmeaning and definition of capital budgetingmajorly definitionreposition definitionnpv defhygiene factors herzbergdefine questionersuasioncauses of channel conflictsoptionally convertible debentureswhat is d1 in black scholes