Lockbox Best Practices Whitepaper
Even though the usage of paper checks as a payment system has plummeted in the U.S. from 40 billion transactions in 2000 to less than 20 billion during the last Triennial Federal Reserve Payments Study, that’s still 20 billion transactions that cause a lot of headaches.
Paper checks account for 20-30% of remittances, particularly in large volumes. If you receive over 1,000 paper checks per month, processing them efficiently is crucial to healthy cash flow and happy customers (including recurring revenue).
How can you ensure efficient, quality paper remittance processing while keeping costs low? Considering that labor is usually the #1 expense of any organization, outsourcing can be attractive, but who’s the right partner?
Outsourcing & Lockbox Banking Options
Many US organizations look to outsourcing to a third party provider, but do not trust the off-shoring of remittance processing because of the
Many local banks offer “lockbox banking” but
they’re more interested in taking advantage of the float: using your
money before you have access to it, leaving you to deal with the mess
that the bank can’t handle. Your bank may also be outsourcing it since
they often lack the production capabilities to efficiently and
cost-effectively processing even modest remittance volumes.
there is an alternative: third-party Lockbox Service Providers that
eliminate the float and specialize in processing high volumes of
remittances containing paper checks and other documents, including
checks, correspondence and other documents unique to specific
organizations like EOBs for healthcare providers.
providers offer a mix of mailroom outsourcing services and cutting-edge
hardware and software technology to save you the labor and capital
expense for what’s needed to get paper payments deposited on the same day they’re received.
This whitepaper discusses the following aspects of third-party lockbox services:
- Best Practices & Benefits
- The Lockbox Service Process
- Lockbox Service vs. Lockbox Banking