What type of system allows a customer's bank to periodically transfer funds from its account to a selling firm's bank account for payment of bills?
A) Disbursement agreement
B) Preauthorized debit system
C) Lockbox agreement
D) Concentration banking system
E) Zero-balance account

Question

Quizplus · Accepted Answer

A preauthorized debit system allows for automatic periodic transfers of funds from a customer's bank account to a selling firm's account, making it an efficient and convenient method for bill payments. Disbursement agreements, lockbox agreements, concentration banking systems, and zero-balance accounts do not necessarily involve automatic transfers or recurring payments.

What Type of System Allows a Customer's Bank to Periodically