Controlled Disbursement Account

Controlled Disbursement Account is a special type of accounts where the bank provides the company with information every morning about what checks will be clearing against the company’s account in that day’s banking business.

The service permits accurate forecasting of daily cash outflow. The company can then make full use of any cash that is not needed to cover the day’s disbursements by investing it or using it to pay down debt or to meet other obligations.

This technique is used by companies that need to make full use of their surplus cash while at the same time funding their disbursements.

The fees for controlled disbursement service can be quite high, so the service would be used only by large companies with a lot of cash to manage because it would not be profitable for others.