What is a lockbox payment?

A lockbox payment is a method of collecting payments from customers where the payments are directed to a designated post office box or lockbox. The bank or a third-party service provider is responsible for collecting and processing the payments on behalf of the company.

Customers typically send their payments to the designated lockbox address, where the payments are securely collected and processed by the bank. The bank then deposits the funds into the company's account and provides detailed information about the payments received.

Lockbox payments are commonly used by businesses that receive a large volume of payments through checks or other paper-based methods. This method helps streamline the payment collection process and allows companies to receive their funds more quickly and efficiently.

Overall, lockbox payments are a secure and convenient way for companies to manage their payment collections and streamline their cash flow processes.