<P> A collection item (also called a noncash item) is an item presented to a bank for deposit that the bank will not, under its procedures, provisionally credit to the depositor's account or which the bank cannot (due to provisions or law or regulation) provisionally credit to a depositor's account . Collection items do not create float . Payment must be received from the payor bank before the item may be credited to the depositor's account . </P> <P> A collection item may be contrasted with a "demand item" or cash item, under which the bank credits the depositor's account immediately . Cheques (or "checks" as they are known in the United States) are usually handled by banks as a cash item, on the assumption that the payor bank will honor the check . Cheques create float (cash in the payor's account which the payor still has access to while the transition has yet to be finalized). </P> <P> Other types of collection items include: </P> <Ul> <Li> Dishonoured cheques or "bad checks". </Li> <Li> A bank draft . </Li> <Li> Negotiable instruments . </Li> </Ul>

Cash items in the process of collection definition