Types of Business Check Endorsements

As a business owner, it is good business to know the different types of business checks endorsements to ensure that your business runs as good as it can without any mishaps from misinformation. Properly endorsing your checks will ensure that your business gets paid in a timely manner.

The basic endorsement of a check is to simply sign it on the reverse side of the check with the name of the business. This is known as a blank endorsement. Identifying where to sign the check will be easy as well. Almost all checks have an instruction to sign below a designated line. After you sign the legal name of the business, you will then sign your name directly below the business’s name. There will be times when a customer will incorrectly spell the business name on the check. To correct this easy to make mistake, write the name of the business just as the customer wrote it and then write the correct spelling of the name of the business followed by your name. Your bank should have no issues with processing the check.

Your business checks can be cashed maliciously when they are endorsed and carelessly mishandled. In order to ensure your checks can not be cashed, a restricted endorsement is the best practice. When a restricted endorsement is used, the back of the check will reflect in handwriting or by stamp, “For Deposit Only”. This will alert the bank that the check is only to be deposited and not cashed.