Paper check and electronic payment (ACH ) fraud is on the rise and is expected to total over $24 billion in damages this year. Fortunately, there are steps your business can take to protect against financial losses. Positive Pay services are among the strongest and most immediate controls available to detect and help prevent check and ACH fraud.
How Does It Work?
Positive Pay works by comparing and verifying the checks you issue to the checks and ACH transactions presented for payment on your account. Checks that do not match your issue file in dollar amount, serial number or payee name are reported online each day so you can decide to pay or return. ACH transactions work similarly. By applying filters to electronic transactions, you can quickly identify fraudulent debits or credits. Filters can include payee name, dollar thresholds, a set list of approved vendors that are paid automatically, along with the option to add filters, such as expiration dates and caps on the amount of money that can be paid to a particular company. You can add vendors to your approved list before an initial transaction to make sure the payment goes through.
Benefits of Positive Pay for Businesses
- Fraud Protection: Prevent altered or unauthorized checks and ACH items from clearing your business checking account.
- Reduced Losses: Avoid financial losses by identifying fraudulent check and ACH transactions before they post to your account
- Customizable: You choose the control level you want for the verification process. You can set certain parameters, such as the payee name, and amount or limits for both ACH and check transactions.
How Can Your Business Prevent Fraud?
Even with Positive Pay, there are still things your business can do to decrease the risk of check and ACH fraud.
- Don’t click on suspicious links or open unsolicited attachments.
- Be wary of unexpected invoices. Business invoice scams often involve office supplies, website hosting services, and directory listings.
- Ensure bank statements, bank reconciliations, and vendor payments are independently reviewed every month to catch anything that might be out of place.
- Limit access to your business bank accounts and ACH system.
- Establish alerts on Online Banking to notify you when certain actions occur. You receive near-instant notifications of any potentially fraudulent or suspicious activity. It’s often possible to receive email or text alerts for the following:
- New credit and debit transactions
- New linked external accounts
- Failed login attempts
- Password changes
Does Your Business Need Positive Pay?
All businesses benefit from Positive Pay because no company is immune to fraud. The more checks and ACH transactions your business issues, the more you will benefit from using Positive Pay to protect against fraud and streamline the reconciliation process. If you’re unsure whether Positive Pay is right for your business, contact one of our Cogent Associates, and we will be happy to help you find the best solution for your business.
Get Positive Pay with your Business Checking Account!
Your business is unique, and our knowledgeable bankers take the time to ask questions and understand your specific needs. Armed with this information, we will develop a tailored approach to help you mitigate risk.
Open a new business checking account today and add Positive Pay to your Cogent checking account for increased fraud protection.
The information contained herein is for informational/educational purposes only. The views and opinions expressed in this document may be those of the individuals and may not necessarily reflect those of Cogent Bancorp and its subsidiaries and affiliates, or the entities they may represent. Content contained herein may be used in connection with the advertising and/or marketing of products offered by Cogent Bank or Cogent Private Wealth. The material is not intended to provide or substitute for legal, tax, or financial advice or to indicate the availability or suitability of any Cogent Bank product or service. You should consult with a legal, financial, tax, or other appropriate professional(s) for your specific needs and/or objectives before making any decisions.
