With respect to the workings of a lockbox system, the payments are recorded on the customer's account prior to the cheques being deposited.

Lockbox System

A service offered by banks to companies for the receipt of payment from customers, involving the collection and processing of checks at a secure location.

Customer's Account

A record maintained by a business or financial institution that tracks an individual customer's purchases, balances, and transactions.

Cheques Deposited

The act of placing a check into a bank account for processing and eventual availability of funds.