Keycorp plans to waive temporarily the standard electronic transmission fees associated with its "positive pay" services.
Positive pay is a cash management service aimed at stopping check fraud. Corporations electronically send banks information on recently issued checks. The bank, armed with this information, can then notify customers when dubious checks are presented for collection.
Lilly Straith, a cash management manager with Keycorp, expects the fee waiver, which will last six months, to double the number of corporate clients that use positive-pay services.
Although declining to reveal what the bank's fees are, or how many corporations actually use the service, she said the average cost saving for its customers will be as much as $600.
Jean Mong, a vice president with Keycorp, said the Cleveland-based institution developed its positive-pay services last year to battle the widening war against check fraud.
Banks and their corporate customers are increasingly encountering instances of check fraud, according to a biannual check fraud survey published by the American Bankers Association.
Losses from check fraud amounted to $815 million in 1993, a 43.5% increase over 1991's losses. That figure also represented a 136% increase in the number of fraud incidents.
The ABA is in the process of preparing its next check fraud survey and expects to have questionnaires in the mail by January.
In an interview earlier this year, Larry Forman, a cash management expert with New York's Ernst & Young, said banks were discovering a surprisingly "responsive" market for positive pay, especially after incidents of fraud. He predicted that banks like Keycorp will ratchet up their positive-pay marketing efforts.
Nearly half of all banks with assets above $5 billion did not market positive-pay services to their clients, according to the ABA survey.