Reduce your exposure to fraud with positive pay

Technological advances have made it easier for businesses to manage their operations and improve their bottom line. However, as technology becomes more sophisticated, businesses must be more diligent to prevent fraudulent transactions from occurring.

“Many businesses turn to their banks to help mitigate the likelihood of fraud,” says Marianne O’Connor, cash management advisor at Northwest Bank. “That’s why we’ve invested in preventative measures, like positive pay, which can help reduce the risk of fraud by stopping suspicious transactions before they occur.”

Smart Business spoke with O’Connor about how positive pay can benefit your business.

What is positive pay and how does it benefit businesses?
Positive pay is an automated fraud detection tool for business customers of all sizes and industries. There are two types of positive pay available — check and ACH positive pay.

Check positive pay matches the credentials listed on the check, like account and check numbers, dollar amount and issue date, against a list of checks previously authorized by the company. ACH positive pay is an online fraud service that allows businesses to monitor ACH debits.

With each type of positive pay service, you can return fraudulent transactions before they post to your account, which could potentially prevent devastating losses.

There is also a reverse positive pay, which allows an authorized user at your company to review checks written to your business before they post. Positive pay is an extra layer of protection between your business and customers, and it gives you peace of mind knowing the checks that are posting are legitimate. Because you can review and approve transactions quickly and easily right from your office, it can potentially save your business from the time-consuming process of dealing with a fraudulent incident.

What might hold businesses back from using positive pay?
Many businesses think having this type of service is expensive — however, thanks to evolving technology, it’s easy and inexpensive to implement. Another misconception is that it’s difficult to use. Positive pay isn’t a complicated system. Your cash management advisor will sit down and show you how it works and provide ongoing support if you need it.

Is there a specific type of business or industry that would benefit most from positive pay?
There are certain industries that are more prone to fraud than others, but none are exempt. Chances are, if you work with a computer and handle payments, your business runs a risk of being compromised. Banks have seen a significant increase in fraud over the last several years, which is why systems like positive pay are so valuable. It’s one of the best ways to prevent loss before your accounts are affected.

What role does a cash management advisor play in helping businesses understand positive pay?
As your trusted partner, your cash management advisor should have an in-depth understanding of your business and its payment needs. They can help during the set-up process and answer questions that may be specific to your business or industry.

As financial experts, they deal with a variety of payment questions and issues each day, so you should never feel intimidated to call them for help or advice.

What do you want readers to take away from this article?
While it’s true that instances of fraud are on the rise, that doesn’t mean there’s nothing that can be done to prevent it. Services like positive pay can help prevent fraud without being a burden to your operating budget thanks to its affordability, ease of use and ongoing support from your cash management advisor and bank.

It just takes a quick call to your cash management advisor to sign up for positive pay and provide your business with added peace of mind knowing you’re protected from potential costly fraud.

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