Night Depositories (What Are They And How They Work: Overview)

What are Night Depositories?

How do they work?

What are the essential elements you should know!

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What Are Night Depositories

A night depository is a secured method for businesses to make a bank deposit of cash, checks, or other forms of paper, outside their bank’s normal business hours.

Typically, the bank provides a secured “drop box” where the bank’s clients will make their deposits from the outside of the bank building.

The bank account holder will follow a specific process to make night deposits:

• Insert the daily cash or checks into a locked bag given by the bank
• Use a key to unlock the night drop box 
• Insert the locked bag into the bank drop box 

Although most bank transactions are done electronically in today’s economy, there are many businesses that do business by receiving a large volume of hard cash.

As a result, the night deposit service continues to be offered by banks allowing small business owners and companies to securely deposit the monies they have collected during the day and protect themselves against theft.

Night Depository Features

A night depository system is available 24 hours a day and 7 days a week for businesses to make deposits of cash, coins, checks, or deposit slips.

After business hours, typically after 5 pm and before 9 am, businesses can safely and securely drop their cash and checks at the night drop box offered by their bank.

The next business day, a trained bank manager will collect the deposited cash, coins, and checks and post them to the business’ commercial bank account.

The night depository works in a similar way as an Automated Teller Machine (ATM) with the difference that you are not limited by how much money or paper you can deposit at a time.

In essence, the night depository does not limit how much cash, checks, or paper a business can deposit during the night.

Night depositories charge a monthly fee to allow you to access their deposit box on a 24-hour-a-day basis.

How To Use Bank Night Deposit Box

A night deposit is quite simple to use:

• Open a commercial bank account with a bank offering night drop services 
• The bank will provide you with a special key to access the night deposit box from the exterior of the bank building
• The bank will provide you with a special locked or zipped bags for your deposits
• Place your daily cash, cheques, debit card receipts, or credit card receipts into the zipped bag
• Go to the night deposit box at the exterior of your bank’s building
• Using your key, unlock the deposit box
• Make your bank drop 
• A bank personnel will then collect your bank and make the deposit into your account the next business day 

There you have it, you have done your overnight deposit.

Night Deposit Safety Tips

Using the night depository services provide a convenient and safe method for depositing cash, coins, and deposit receipts.

It’s important to take measures to ensure that your deposits are done safely and securely:

• Prepare your deposit bag in a secure environment
• Be mindful of your surroundings when making a deposit at night 
• Make sure that the bank deposit drop box area is properly lit 
• Do not ask or accept assistance from anyone
• If anything is suspicious, do not make a deposit 
• As you go to the night drop box, make sure your cash or coins are not visible 
• Don’t make night deposits at the same time based on a routine 

Night Depository Agreement

To obtain bank depository services overnight, you will generally be required to sign a night depository agreement with your bank.

In this agreement, the night depository procedures, legal terms and conditions, and any other relevant terms will be outlined.

Business can instruct the bank to either proceed with the deposit of the hard cash the next business day or keep the bags locked until a personnel from the business is present at the bank.

The advantage of having the bank personnel make the deposits without waiting for the business owner is that you can have your deposits posted to your account quickly but in case the bank personnel makes an error, you may not catch it.

On the other hand, waiting for the business owner to open the locked bag with the bank personnel may prevent calculation or error disputes but can take longer for your deposits to be posted.

Night Depositories vs ATM

Night depositories:

• Account holder can make a deposit at any time
• Deposit boxes are located outside the bank building 
• The deposits are posted to the account holder’s account the next business day 
• There are no limit on how many checks, cash, or coin to deposit

ATM:

• Account holders can make deposits at their branch
• Deposits must be posted on the same day as the deposit as per the Federal Deposit Insurance Corporation regulations (FDIC)
• Must display a cut-off time for the deposits on the same 
• There is a limit on how many checks or cash can be deposited 

Deposit Drop Box Takeaways 

So what is the legal definition of Night Depositories?

Let’s look at a summary of our findings.

Night Deposits 

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