Positive Pay Could Protect Your Agency from Fraud

Positive Pay Could Protect Your Agency from Fraud

Article By: Deirdre Tumm, SFB Treasury Management Officer

More and more often insurance agencies are utilizing the banking service of Positive Pay as a means of fraud protection. Positive Pay services allow banking clients to upload a Positive Pay file (a listing of checks written from the client's account), which is used to compare against the checks presented to the financial institution for payment. 

When a check is attempting to clear the client's account but is not referenced within that client's Positive Pay file, the check is considered an exception. To manage that exception, the client is notified and asked to review whether the check should be cleared. Positive Pay is often considered a cost-effective theft prevention offering. Some financial institutions even offer this service for ACH debits as well. 

Most Positive Pay service offerings consist of a monthly service fee (averaging between $30 - $70) and an exception item fee (averaging $1-3/exception item). With business banking clients having a reduced timeline to dispute invalid account debits, the concept of theft protection services is gaining traction. Does your agency utilize Positive Pay?  What forms of theft protection services is your agency utilizing today? Now might be a good time to meet with your banker to discuss.

Deirdre Tumm is a treasury management officer for Security Financial Bank, a Wisconsin financial institution that specializes in lending to insurance agencies. Deirdre uses her cash management expertise to seamlessly guide SFB's insurance agency clients with their depository needs and specialized business services.  Some of those services include remote deposit capture, Positive Pay, and ACH services.