Alliance Bank launches new lockbox service

CNY Business Journal (1996+), Apr 02, 2004 by Dickinson, Casey J

SYRACUSE - Alliance Bank has launched a new billing service for customers with high-billing volumes. The bank is offering lockbox service to handle its customers' incoming bill payments.

The lockbox service is aimed at companies that mail at least 3,000 statements each month, says Joseph Russo, vice president of marketing and investor relations for Alliance Bank, NA. Alliance is using Optical Character Recognition (OCR) technology at its Cortland office to process statements and checks electronically.

Russo believes Alliance is the first locally based bank to offer lockbox services.

service is designed to cut down on the labor of in-house bill processing for growing companies.

"Doing 3,000 statements each month can be a pretty slow process," says Russo. Lockbox service is part of Alliance's 6hsh-management service. Lockbox customers coordinate their billing practices with Alliance's processing system, adding code and standardizing statements. The customer's billing address becomes that of Alliance's Cortland office. Many companies use out-of-state lockbox services, Russo explains, as evidenced by the variety of return addresses found on local companies' billing statements. When the customer's incoming statements arrive at Alliance, employees remove the statements and checks from envelopes and feed them into machines that can read coded information as well as numbers. The machines process the statements and checks and credit the customer's account. An electronic file-transfer updates the payment status as the checks are processed. In addition to the electronic file, the paper statements are forwarded to the customer as well.

Using a lockbox service, says Russo, gets payments into the bank faster than having employees manually process incoming payments. The OCR system also helps to reduce human errors in a company's receivables.

There is no upper end for the lockbox service, Russo explains. The banks scalable hardware can accommodate- added capacity for any clients.