What is controlled disbursement?
Controlled disbursement is a proactive banking service that provides organizations with a detailed report of all checks presented for payment on a given day before the funds are withdrawn.
Early in the day, the bank sends a controlled disbursement report that includes the number and total amount of checks scheduled to clear. This advance notice enables organizations to reconcile these checks against their authorized transactions, ensuring that only legitimate payments are processed.
When organizations have visibility into upcoming disbursements, they can better manage cash flow and quickly spot any discrepancies or unauthorized checks before the funds leave their account.
What's important here?
Controlled disbursement and Reverse Positive Pay are both cash management tools that help organizations monitor outgoing payments and prevent fraud, but they operate differently.
Controlled disbursement provides early visibility into daily check clearings, allowing organizations to manage cash flow more effectively and confirm authorized transactions before funds are withdrawn.
Reverse Positive Pay requires organizations to review a daily list of presented checks and manually approve or reject suspicious items before processing.
While both methods enhance cash control and fraud prevention, controlled disbursement offers a proactive approach to cash management, whereas Reverse Positive Pay requires continuous oversight to detect unauthorized transactions.
