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WHAT IS POSITIVE PAYWhat is Positive Pay?

Positive pay is the leading method of check fraud deterrence available today. A positive pay process entails a daily reconcilement of a company's issued checks to checks presented for payment to the Bank to identify potentially fraudulent checks. Upon completion of a check run, a company prepares a formatted checks issued data file (including check number, amount and date as well as other bank and account information) and transmits this data to the bank. Stop payments, voided checks and manual checks can also be included in the formatted checks issued file. When checks are presented for payment against a positive pay protected account selected check information is compared to the checks issued file. Checks presented for payment that fail to match with checks issued by a company are rejected and a "suspect check" list is presented to the company for "pay/no pay" decisions. Suspect checks are resolved before the bank authorizes payment and the company retains the right to reject any checks it believes are fraudulent. In addition to providing you with a method of fraud prevention on your account, the positive pay system can also double as a reconciliation tool. As a result of you providing the bank with a list of issued checks, the bank is able to generate month-end reports that can aid with the reconciliation process. Reports can include a listing of checks paid, checks that were issued and not paid, and checks that had stop payments placed.

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