Positive pay is a fraud check. Before a high-value cheque reaches the bank, the issuer confirms its details — number, date, payee, amount — through their bank's channel. When the cheque is presented, the bank compares it against what was declared and flags a mismatch.

In India the Reserve Bank introduced Positive Pay for cheques above a threshold value; the exact threshold and how it is applied depend on the bank, so check your own.

The fraud it stops

Chiefly alteration. A genuine cheque intercepted in the post and modified — payee changed, amount raised — looks legitimate to the paying bank because the signature and the paper are real.

Positive pay defeats that, because the bank already holds your version of the details. Changing the payee makes the cheque disagree with the declaration and it gets stopped.

What you have to do

  • Declare before presentation. A declaration made after the cheque arrives is no use.
  • Get the details exactly right. A typo in your own declaration causes a false mismatch, and your legitimate cheque is the one that gets held up.
  • Know your bank's threshold and channel. Both vary.

Where cheque records earn their keep

Positive pay means transcribing cheque details accurately, sometimes for several cheques, sometimes days after they were written. Doing that from memory or from a stub is where mistakes come in.

If your cheques are printed and recorded, the details are already stored against the cheque number — number, date, payee and amount, exactly as printed. Reading them off a record you can search is both faster and less error-prone than squinting at a counterfoil. See reports and advanced search.