What Is Positive Pay? How It Works, What It Costs, and the Washed Check It Can Miss

What is positive pay? The short answer

Positive pay is a bank service that checks every check presented against your account against a list of the checks you actually wrote. You send the bank an "issue file" with each check number and amount (and at some banks, the payee name). When a check shows up that does not match, the bank holds it as an exception and asks you to decide: pay it or return it. At many banks the service is free on the right account tier, and it is the main defense a business has against washed and counterfeit checks.

Sourcing note: the mechanics below come from the banks' own pages, read September 27, 2026: Chase's Fraud Protection Services overview and its business check-fraud guide, Community Bank N.A.'s positive pay FAQs, and Truist's Business Deposit Accounts Fee Schedule (effective June 5, 2026). The fraud numbers are from FinCEN alert FIN-2023-Alert003, and the liability rules from UCC 4-406 on Cornell Law School's Legal Information Institute.

How positive pay works, step by step

1. You write checks and send the issue file. Every time you cut checks, you upload the list: check number, amount, date and, where the bank supports it, the payee.
2. A check is presented for payment. Community Bank N.A. describes the match plainly: the bank verifies "the check number, payee, and dollar amount" against your check issues.
3. Mismatches become exceptions. A check that is not on your list, or whose amount does not match, is held. You review it in the bank's online banking.
4. You decide by the cutoff. At Community Bank N.A. the deadline is 12:00 p.m. Eastern for both check and ACH positive pay exceptions.
5. If you do nothing, the default kicks in. This is the part that varies most by bank, and it is covered in its own section below.

The three kinds: positive pay, reverse positive pay and ACH positive pay

Chase's overview says an account "cannot be enrolled in both Check Monitoring and Check Protection Services at the same time," so at Chase you pick one of the first two. ACH debit blocking sits alongside either.

The default decides who eats the loss

Every positive pay service has a rule for the exception you never looked at, and the two banks we read do opposite things:

• Community Bank N.A., positive pay: "If you don't decision the item by the cutoff time, the item will be returned." Miss a morning and the suspicious check bounces.
• Chase, Check Monitoring (reverse positive pay): a "payment decision [is] required by the cutoff time for each payment presented or the payment will be processed (unless otherwise agreed to in writing)." Miss a morning and the check is paid.

Default-return is safer against fraud and harder on real vendors: a legitimate check you forgot to log bounces back to someone you owe money. Default-pay is easier on vendors and does nothing for you on the day you are out sick. Ask your bank which default your service uses, and ask whether it can be changed, before you rely on it.

What positive pay does not tell you: the check it can miss

Positive pay matches the fields it is told to match. If a fraudster keeps the check number and amount and changes only the name, a service that ignores the payee sees a perfect match.

That is not a hypothetical shape. Chase's own business guide describes check washing as "erasing the ink and writing in a higher value to a different recipient," and FinCEN's 2023 alert says washed checks have "the payee information" replaced, often along with the amount. A higher amount trips any positive pay service. A new payee on the original amount trips only one that compares payee names.

And payee matching is not a given. Chase's overview says "Payee Name Verification is not available through Chase Business Online" for its Check Protection Services. Other banks offer payee matching, sometimes as a separately named feature: Community Bank N.A. has its own FAQ on "Positive Pay Name Verification." If your bank's plan does not compare payees, a washed check that keeps your amount can clear.

How much does positive pay cost?

It depends on the bank and the account, and the big banks do not print it where you would look:

• Chase: business checking customers "may enroll in Check Monitoring/Check Protection Services and ACH Debit Block at no additional cost, based on account eligibility," subject to Chase's approval. The catch is the eligibility: Check Protection (positive pay) and ACH Debit Block are only open to Chase Performance Business Checking, Chase Platinum Business Checking and Chase Analysis Business Checking. A business on the entry account gets Check Monitoring, the review-it-yourself version.
• Truist: its Business Deposit Accounts Fee Schedule, effective June 5, 2026, prices a Stop Payment Order at $35.00 and does not list positive pay at all. The schedule says pricing for "additional treasury services is provided separately." In other words, the after-the-fact fix has a public price, and the prevention does not.

So the honest answer is: free at some banks on higher tiers, quoted separately at others, and worth asking about before a fraud rather than after. If your bank charges for it, compare that monthly fee with one $35 stop payment, one returned-item fee and one afternoon on the phone with the fraud team.

Why businesses should care: check fraud and the reporting clock

FinCEN's alert on mail-theft check fraud (FIN-2023-Alert003, February 27, 2023) counted more than 350,000 check-fraud Suspicious Activity Reports from banks in 2021, up 23 percent, and more than 680,000 in 2022, "nearly double the previous year's amount." It also says why business checks are targeted: "business accounts are often well-funded and it may take longer for the victim to notice the fraud."

Noticing late costs money under the Uniform Commercial Code. UCC 4-406 requires a customer to examine statements "with reasonable promptness." If you do not report an unauthorized signature or alteration, the bank can refuse to cover later forgeries by the same wrongdoer once you have had "a reasonable period of time, not exceeding 30 days" to catch the first one. And regardless of anyone's care, a customer who does not discover and report an unauthorized signature or alteration within one year of the statement is precluded from making the bank pay it back. Positive pay turns that monthly statement review into a daily one, which is the whole point.

How to set up positive pay without breaking your vendor payments

1. Confirm your account qualifies. At Chase that means one of the three eligible business checking tiers; elsewhere, ask the treasury team.
2. Ask four questions: What fields are matched (number, amount, payee)? What is the daily cutoff? What happens to an undecided exception? Is there a fee?
3. Automate the issue file. Ask your bank which file format it accepts, then check whether your accounting or AP software can produce it. A file that depends on someone remembering to upload it is the file that is missing on the day a washed check arrives.
4. Name a backup. Exceptions need a decision every banking day before the cutoff. Two people should have the rights to decide them.
5. Add ACH positive pay. Check fraud is the headline, but the routing and account numbers printed on every check are the same two numbers used to set up an ACH debit. Allow-list the companies that should debit you and block the rest.

Positive pay vs stop payment vs voiding a check

These get confused because they all stop a check, at different moments. Voiding a check is a pen stroke on paper you still hold. A stop payment is a request to your bank about one specific check you already sent (Truist charges $35.00 for it). Positive pay is standing protection for every check you did not write. If you pay vendors by check, the cheapest fix is often fewer checks: ACH payments cost cents, and our guide to AP automation software compares the tools that move vendors from paper checks to ACH. For when a legitimate deposit becomes spendable on the other side, see how long it takes for a check to clear.

Stop keying checks and bank details by hand

The issue file is only as good as the check register behind it, and the register is only as good as the invoices typed into it. If your team still reads vendor invoices and bank letters by eye and keys them into your books, SuperDupr's AI document processing extracts the payee, amount and bank details, and flags mismatches before a check is ever printed.