| A bank check is a negotiable instrument | | | | check, and it usually contains orders such as |
| issued by a bank to pay a specified sum of | | | | "pay cash." A certified check is a personal |
| money to a person upon demand. It is in the | | | | check whose payment is guaranteed by the bank |
| form of a written order and is drawn against | | | | on which it is drawn. Crossed checks carry |
| funds deposited in the bank. Bank checks are | | | | across its face two parallel lines with |
| also known by different names such as a | | | | instructions such as "not negotiable" or |
| cashier's check, teller's check, and | | | | "account payee only" between them. Such |
| treasurer's check. They are primarily used to | | | | checks can only be paid into a bank account |
| send monetary gifts, settle subscriptions, | | | | and cannot be paid over the counter. An order |
| and make payments for goods bought. | | | | check is paid to a person whose name is |
| | | | written on the check. |
| Bank checks generally contain information | | | | |
| such as the name of issuing bank, name of | | | | One of the prime features of a bank check is |
| payee, date of issue, signature of drawer, | | | | that it can be transferred to a person other |
| and amount of money. The amount should be | | | | than the payee specified in the check, |
| specified both in numeric and written format. | | | | through a process known as endorsement. It is |
| In addition, bank checks include check number | | | | done by putting a signature on the back of |
| known as bank routing number. Also called ABA | | | | the check, thereby legally transferring the |
| number, a bank routing number usually has | | | | ownership of the check to some other person. |
| nine digits and is printed on the MICR line, | | | | Sometimes, a bank check is returned or |
| across the bottom of the check. | | | | dishonored due to reasons such as incomplete |
| | | | information, a discrepancy in amount, and a |
| Bearer checks, certified checks, crossed | | | | difference in signature. Also, if there isn't |
| checks, and order checks are among the | | | | sufficient money in the bank account, bank |
| different types of bank checks. The key | | | | checks are returned. Such bank checks are |
| feature of a bearer check is that it is paid | | | | called "bounced checks," and you have to pay |
| to the bearer or the person holding the | | | | a penalty for the returned check. |