Once you activate Positive Pay, your bank will begin validating any checks presented for payment from your account against the check data you gave the bank beforehand, such as the check number, issue date, account number, or dollar amount. If the information doesn’t match, the bank flags the check and notifies you for examination.
How Does Positive Pay Work?
Positive Pay helps business owners safeguard their bank accounts against any losses by detecting suspicious transactions before they get processed. For example, suppose Sally uses Chase for her business banking and she’s enrolled in Positive Pay (which, at Chase, is called “Check Protection Services”). Here’s how the process works:
How Much Does Positive Pay Cost?
Some banks (such as Chase), offer complimentary Positive Pay services for select business banking accounts. Other banks charge monthly fees, per-item fees, or a combination of the two. For example, here’s a look at three banks’ Positive Pay programs: With Positive Pay, your bank reviews every check presented for payment and verifies that the details match the information you’ve provided to the bank beforehand. Reverse Positive Pay requires you to set a payment threshold. Your bank will only notify you when it needs to process checks over that limit. Another major difference is how banks handle flagged checks if you don’t review them by the deadline. Positive Pay declines an unapproved check, returning it to the issuer (potentially charging you a returned item fee in the process). With Reverse Positive Pay, a bank will typically process the payment anyway, even if you don’t respond within the posted time frame.
