Positive pay is a fraud protection tool offered by most banks. It offers companies a way to send a list of checks they issued to their bank, and the bank will in return only allow deposit of cashing of checks that are on the list. If the bank is presented with a check that doesn’t match any check on the list, the check will be declined and become an exception item. The bank will send a copy of the check to the company that can instruct the bank to either pay or return the check.
The list will typically contain check number, amount, and date. Sometimes they payee is also part of the information that is provided to the bank. The bank will require a perfect match between the check and the list before they will pay the check. If the company voids check, that will become part of the list of checks they send to the bank, however voided checks will obviously not be honored by the bank.
SimCrest has an add-on for Dynamics NAV that will handle positive pay for any bank in the United States. Check out the add-ons for Dynamics NAV here.