Each library system or branch can specify what types of items can circulate without being cataloged. A common example is 'Paperbacks' - inexpensive paperbacks that can be circulated, but which are not individually cataloged and are not holdable. These non-cataloged types are configured at:

Administration > Local Administration > Non-Cataloged Types Editor

The list of non-cataloged types appears in the lower part of the screen, and includes whichever non-cat types set for the “Focus Location” (changeable via the dropdown menu). These will appear to your library’s staff from the Checkout interface. A new non-cataloged type can be created in the top interface by entering a name, selecting the time the item will circulate, whether it circulates in-house, and the organizational unit (system or individual branch) for which you would like the type to be available.