Positive pay is an automated cash-management service used by financial institutions to deter check fraud. It is a service provided by financial institutions to their customers, and clients enrolled in the program have special fraud detection services to protect their accounts. The system matches the date, check number, dollar amount, and account number of each check presented against a list provided by the company to protect against forged, altered, and counterfeit checks. Any suspicious items are verified with the client. Positive pay is a check fraud prevention tool that verifies checks presented to the bank for payment against a document listing details about every check the business has issued, known as the check-issue file. Positive pay checks may be part of a positive pay file, which is a file consisting of checks written by an organization over a specific period of time. Positive pay is a proactive step businesses can take to protect themselves from losses and other fallout from payment fraud.

Some key features of positive pay include:

• Positive pay is a service provided by financial institutions to their customers to protect against check fraud.
• The system matches the date, check number, dollar amount, and account number of each check presented against a list provided by the company to protect against forged, altered, and counterfeit checks.
• Positive pay is a check fraud prevention tool that verifies checks presented to the bank for payment against a document listing details about every check the business has issued, known as the check-issue file.
• Positive pay checks may be part of a positive pay file, which is a file consisting of checks written by an organization over a specific period of time.
• Positive pay is a proactive step businesses can take to protect themselves from losses and other fallout from payment fraud.

While positive pay is a smart form of business banking that simplifies the check cashing process, helps a business reduce errors, and saves on labor costs, it may come at a fee for businesses. However, most companies find the tool well worth the investment to protect against check fraud and financial losses.