Function

• When you use a lockbox banking service, you are assigned a lockbox with an address. All of the payments you receive from your customers are sent to the lockbox address. The lockbox is maintained by the bank, which opens and processes the payments on your behalf.
  
  

Types

• Most banks generally offer two types of lockbox banking services: wholesale and wholetail. Wholesale lockboxes are for business-to-business companies that receive a small volume of high-dollar payments. Wholetail, sometimes called retail, lockboxes are for business-to-consumer companies that generate a high volume of low-dollar payments.
  
  

Benefits

• Lockboxes increase efficiency and allow quicker access to funds. The bank will generally pick up and process remittances several times per day. This eliminates the need of having an employee dedicated to sorting the mail, preparing the deposits and taking them to the bank on a daily or semi-daily basis.