Lock box service ensures you receive the proceeds from your sales in the United States. Payments are sent to you as a fund transfer or cheque. This service gives your business an address in the United States where you can receive the proceeds from your sales directly. The lock box is linked to a U.S. dollar account opened in the United States that can also be used for your accounts payable.

Many financial institutions offer lock box service. They pick up your cheques every day and then transfer the amounts to your account in Canada. They will inform you of the amounts of the cheques received using the communication method of your choice.

This process saves you time because the cheques are sent within the United States rather than to Canada. You avoid mail service delays between the two countries, in addition to having better control over your accounts receivable and eliminating the risk that your suppliers would be unable to cash the company cheques you draw on your bank in Canada.

Of course, if the buyer doesn’t honour a debt, legal proceedings may ensue. The lock box should only be used when the buyer and the seller trust one another.