Commercial Insights

Positive Pay: A powerful tool to help reduce check and ACH fraud risk

Key insights

• Check fraud remains a major threat to businesses. Fraud involving counterfeit checks, check washing and payee forgery continues to rise, making checks one of the most frequently targeted payment methods
• Positive Pay helps identify suspicious or unauthorized checks before funds leave an account. Checks that do not match your issued check information are flagged for review, allowing you to decide whether to approve or decline payment.
• ACH fraud deserves attention, too. ACH Positive Pay extends protection to electronic payments by helping businesses monitor and identify potentially unauthorized ACH transactions
• Positive Pay strengthens internal controls. The solution adds oversight, verification and exception review processes that support broader risk management and audit objectives
• Implementation is often easier than expected. Many companies already generate the payment information required for Positive Pay through their existing accounts payable systems. And, if the company has difficulty generating the required payment information, they can still mitigate fraud using Reverse Positive Pay. With Reverse Positive Pay the bank provides the client with check transactions each morning and the client determines which checks should be paid

Even as the use of physical checks declines, check fraud is the fastest-growing payment fraud risk businesses face today. According to a 2026 survey by the Federal Reserve, check fraud accounted for 30% of all fraud losses reported by financial institutions, with attempted check fraud increasing 10% year over year.

While the use of digital payment has accelerated, paper checks remain a critical part of business operations. Yet checks are vulnerable to sophisticated tactics such as counterfeiting, check washing, payee forgery and mail theft.

"Fraudsters continue to look for the easiest path to access funds, and checks remain an attractive target because they contain sensitive account information," said Jeff Taylor, head of Commercial Fraud Forensics at Regions Bank. "Businesses need layered defenses that can identify suspicious payments before money leaves the account."

For business leaders, the risks include disruptions in cash flow, use of valuable staff resources to address fraud, reconciliation challenges and exposure to financial losses.

Fortunately, there is a proven solution: Positive Pay.

How does Positive Pay work?

Positive Pay is a treasury management fraud-prevention service that helps businesses identify unauthorized or altered checks—before they are paid.

The concept is straightforward. A company electronically provides its bank with information about checks it has issued. In turn, when those checks are presented for payment, the bank compares the presented item against the customer’s list of issued checks. Any items that don’t match the record are flagged for review.

"Positive Pay is one of the most effective tools available for combating check fraud," Taylor said. "It’s a simple process that allows organizations to verify checks being presented are the same as the checks they originally issued."

Positive Pay is designed to fit efficiently into a company's existing accounts payable workflow, providing an extra level of assurance while not imposing significant extra work on the company’s accounting department.

Typical steps include:

• The company issues checks through its normal payment process
• A file that details information about issued checks is transmitted to the bank. This information typically includes check numbers, dollar amounts, issue dates and payee details
• When a check is presented for payment, the bank compares it against the list of issued checks
• Any item that does not match the authorized information is flagged as an exception
• Authorized company users can then review the exception to decide whether to pay or return the item

As a result, potentially fraudulent or altered checks may be identified and, where appropriate, returned or rejected before funds are disbursed. In turn, this gives businesses greater visibility and control over check payments while helping reduce the risk of unauthorized transactions.

Payee Name Verification adds an additional layer of fraud mitigation to Positive Pay. This functionality within the Positive Pay service alerts the maker of the check to fraudulent alterations in the payee name and creates an exception for review.

Extend protection beyond checks with ACH Positive Pay

Payment fraud is not limited to checks. Even digital payments are not a 100% guarantee of payment security.

Instead, criminals increasingly target Automated Clearing House (ACH) transactions through account takeover schemes, unauthorized debits and other forms of electronic payment fraud.

ACH Positive Pay helps organizations monitor and control these risks by allowing businesses to establish rules and filters for ACH activity. As with checking accounts, transactions that fall outside approved parameters can be flagged as exceptions for review and returned if unauthorized.

"Many organizations focus exclusively on check fraud, but payment fraud can occur across multiple channels," Taylor said. "ACH Positive Pay helps businesses apply the same level of oversight to electronic transactions that Positive Pay provides for checks."

Benefits of Positive Pay

Positive Pay is not simply a banking safeguard. It can provide meaningful benefits throughout an organization. Key advantages include:

• Greater fraud protection: Positive Pay helps identify potentially fraudulent checks and ACH transactions, enabling authorized users to determine whether an item should be paid
• Improved cash flow control: Businesses gain visibility into payment activity and can make informed decisions on exception items before settlement
• Reduced operational disruption: Preventing fraud can help decrease the time and expense associated with investigations, recovery efforts and account remediation
• Stronger internal controls: Positive Pay supports broader risk-management and audit objectives by adding verification and approval processes to payment workflows
• Increased confidence: Finance teams can spend less time worrying about payment fraud and more time focused on strategic priorities

An effective response to today's fraud environment

As check fraud continues to evolve, organizations need proactive defenses that can help stop fraudulent transactions before losses occur. For many businesses, Positive Pay with Payee Name Verification, and ACH Positive Pay offer an important layer of protection —helping safeguard cash flow, strengthen controls and support day-to-day operational resilience in an increasingly complex payments environment.

"Most companies already maintain the information needed to support Positive Pay as part of their accounts payable process," Taylor said. "Implementation is typically straightforward, and the fraud mitigation benefits it provides can prove substantial."

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Regions can help with Treasury Management solutions to improve cash flow, streamline payables, and mitigate unnecessary risk exposure. Learn more.