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Lockboxes Redefine their Value Proposition

For decades, the primary benefits of lockbox remittance processing have been driven by economies of scale - speed, efficiency and lower per-item costs. Recently, new payment channels such as online bill pay and ACH debit have provided consumers with alternatives to writing checks. The shift in consumer preferences from paper to electronic payments has contributed to significant declines in check usage. As check volumes drop and per-unit processing costs increase, the value proposition for traditional lockbox processing diminishes. Providers are responding by investing in the latest technology to keep processing costs low, expand their service offerings and gain a competitive advantage.

State-of-the-art mail automation technology combines opening and imaging into a single device. This dramatically increases efficiency and lowers processing costs by eliminating the most time-consuming and labor-intensive steps - the prep work. Since the equipment can accommodate a wide variety of mail sizes, shapes and thicknesses, a lockbox operation can standardize on one imaging platform to satisfy all their needs. This reduces hardware maintenance costs, maximizes efficiency and simplifies operator training.

Retail lockboxes can further leverage their investment in mixed mail processing to deliver higher value, higher margin services like document imaging and wholesale processing. Critical documents such as correspondence, invoices, contracts, forms and applications can all be scanned, classified and sorted electronically. Lockbox processors can upsell an array of document imaging services to existing clients. And while retail lockbox is a declining business, wholesale B2B payments remain a stronghold for checks and actually offer higher profit margins.

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