Positive Pay is an automated fraud detection service offered by most banks and some credit unions. This service matches a customer’s account number, check number and dollar amount of each check presented for payment against a list of checks previously authorized and validated by the bank customer. For the check to be valid all three components of the authorized check must match exactly or the bank will not pay. Some banks also validate the “Pay to” name

Your customer sends an electronic file to the bank containing information on all checks issued that day.

After providing this data to the bank, your customer then releases/sends the checks to each payee.

The bank compares posted checks to your customers company's issued check information to identify any check number, dollar amount or payee name mismatches. Exception checks are manually examined by the bank for encoding errors and misreads. If applicable, mistakes are corrected.

Based on your customer’s notification preferences, the bank sends email notifications alerting of any Positive Pay exceptions for that day.

Your customer advises the bank of exception checks that they want to be paid or returned each business day by the decision deadline set by the bank.

In most cases there is a fee charged by the bank for using the Positive Pay service, although some banks now offer the service for free with a minimum account balance.

Reverse Positive Pay allows a bank customer to review all prior day checks that were presented for payment. If any of these checks do not match the checks issued, the company can investigate further by viewing an image of the check. At that point they can then elect to pay, return or adjust the dollar amount or check number of the check. By default, checks where the client has not made a decision prior to the cutoff time will be paid.