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Lockbox – Functional Prospective
Posted By Sanjit Anand On June 28, 2008 @ 6:15 pm In Oracle Receivable | 4 Comments
Is this a one of the Business scenarios:
If this is case and and your business is growing without AR work force, than get use of Lockbox services offered by Different Bank. You need to check with your banking partner, are they offering any such kind of service or not in your region.
LockBox - An Automated Banking Solution
In Financial term normally used by bank is called Lockbox, in which bank will improve your cash flow that enhancing company's working Capital.This is technology driven technique in which you have your customers' payments delivered directly to a special post office box instead of your business address and then bank will take care of all your remittance activity.
Its via ..PO Box
You might have one quick question at this stage, Is this same PO Box, that National Postal Department using?
The answer is no, as the key difference between the Lockbox post office box number and a regular post office box is that only your customers' payments are delivered to the box. Instead of you picking up the payments, bank's couriers have a key to the post office box, and they remove its contents and deliver your customers' payments to your bank. Your bank opens the payments and then processes the payments for deposit directly into your bank account.
The entire business Flow can be best understood as :
>> What additional things bank handle when you are using Lockbox
These are the some of the services, now a days most of bank offering in LockBox Feature. This Includes
Which Kind of business does Requires Lockbox
Lockbox is best used by the companies which have numerous customers base such as:
Benefits of using LockBox
The LockBox Utilizes two primary benefits :
On top of that major benfits are that company is able to recognize the funds more quickly and customer's check is cashed bit faster.
These steps should be prerequisite  as per this post.
The Importance of receivables Information
Thats true , the importance of receivable information can not be neglected.
Most of the bank passes these information,
Once bank processed, a electronic File is transmitted and transferred to company which owns the lockbox.This files can be in one of two standard banking industry formats: BAI or BAI2 which is defined by Bank Administration Institute (BAI). In some cases and some countries if not following the standard , you can can also get use the transmitted via EDI using the ANSI X.12 823 for lockbox remittances.
Supported Format in Oracle AR
Oracle does provide some seeded file format that you can configure based out of your need.These are the list of Files:
Global Bank & LockBox
Most of global(ABN, Bank of America, CitiBank, Deutsche, HSBC, JP Morgan and Standard Chartered) as well Local bank are offering Lockbox servics , therefore if you are planning to take an adavantage for lockbox services to boost customers' bottom line, then Choice is Obvious.
Let me know, in case if you need some more input , I will share some more implemenation senarios.
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 mention in this post: http://www.oracleappshub.com/accounts-receivable/know-15-important-things-before-you-can-do-auto-lockbox-setting/
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