How to Endorse a Cheque: Tips and Guidelines

Endorsing a cheque is an important task that should be done correctly in order to ensure the payment goes through smoothly.

There are a few things you need to keep in mind when endorsing a cheque: what type of endorsement to use, how to sign the cheque, and who to make the endorsement out to. Stay tuned to learn about all of these things so you can feel confident the next time you visit the bank!

Let’s get started!

How to Endorse a Cheque?

When you endorse a cheque, you are signing it to indicate that you agree to the payment. The endorsement goes on the back of the cheque and is typically done in blue or black ink. 

You can endorse a cheque by writing your name, using a stamped signature, or by signing the back of a cheque with an “X”. If you are signing with an “X”, make sure that the person who is cashing the cheque knows that it is your signature.

A typical cheque has a 1.5-inch space at the back that you should fill in. This area is known as the endorsement section, with clearly drawn lines and warnings such as “Do not write, stamp, or sign below this line.” Make sure you keep all of your signatures and any other details within that zone.

The name signed on the back of the endorsed cheque must match the payee’s name on the front of the check to be valid. If you made a mistake in your spelling or writing, sign it using the misspelled version and then sign again with your correct name.

You should also include the date of the endorsement and any special instructions. For example, you may need to write “For Deposit Only” if you are depositing the cheque into your bank account. If you are signing a cheque over to someone else, you will need to write “Pay to the Order of” followed by the name of the person who is cashing it.

Once you have endorsed the cheque, it is important to keep it safe until it is cashed. You should never leave an endorsed cheque unattended or in a public place. If you are mailing the cheque, be sure to use a secure method such as registered mail.

Read More: How to Write a Cheque in Canada?

Types of Endorsement

Based on your needs and preferences, you can choose from several ways to endorse a cheque:

Restrictive Endorsement

A restrictive endorsement prohibits a signed cheque from being deposited into any other account. You may apply this approach by including your account number with the endorsement, providing specific instructions that the funds can only be deposited into your bank account.

Write “For deposit only to account #####” (using your account number) as part of your endorsement if you want to keep the money in a separate account. It’s harder for robbers to take your money if they have to edit the endorsement. 

Special Endorsement

It’s also feasible to pay someone else using a cheque made out to you. In essence, you’re sending the funds from the cheque directly to someone else. This is referred to as a special endorsement of a cheque. Simply write “pay to the order of” followed by the name of the recipient and sign your name underneath.

However, depositing third party cheques in Canada is a really insecure way of sending money. Consider bringing the person you want to pay with you to the bank so they can provide proof of identification, as many banks do not allow this type of endorsement. 

When you request to endorse a cheque in this way, your bank will ask you to deposit the money into your account before sending them to another person.

Blank Endorsement

A blank endorsement is the most straightforward type of endorsement. All you need to do is sign your name on the back of the check in the endorsement area. By signing a blank cheque, you’re giving the payee full rights to cash it or deposit it into their account.

You should only endorse a cheque in this way if you trust the payee implicitly. For example, you might do this if you’re depositing a cheque into your joint account and your spouse is the payee.

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Business Endorsement

In some cases, a cheque can be made out to a business. This means that an authorized individual must sign the cheque on behalf of the company. 

The procedure of endorsing a company cheque is slightly more intricate, but it is completed in the same area where you endorse checks for individuals. To endorse a cheque for a business, write the name of the business and sign your name underneath the line.

Mobile Endorsement

It’s possible that you have to sign your check in a certain manner if you deposit it using your bank’s Android app or online system. If you use this method to make a mobile deposit, several banks will demand that you write “mobile deposit.” Check your bank’s policy to see if you’re doing it correctly.

Related Article: How to Write a Void Cheque

Common Mistakes when Endorsing a Cheque in Canada

Be sure to avoid the following mistakes when endorsing a cheque:

Misspelling Your Name

One of the most common mistakes people make when endorsing a cheque is simply misspelling their own name. This can cause major delays in getting your money, as the payee’s bank will have to confirm that the endorsement signature on the cheque matches the one on file.

Multiple Payees

A single check might be made out to several payees on rare occasions. A check given as a wedding present, for example, will frequently be made out to two individuals. Even if the money is deposited into a shared account, many banks will demand that both parties sign the cheque in this situation since it can cause considerable difficulty.

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Incorrect Amount

When signing a cheque, be sure to include the amount in both words and numbers. The numerical amount should always match the written amount, as this is how your bank will verify the amount. If these two figures don’t match, your bank may refuse to process the cheque.

Endorsing a Post-dated Cheque

You should never endorse a post-dated cheque. This is because you’re essentially promising to pay the amount on the cheque on a specific date. If you endorse a post-dated cheque, the payee can cash it immediately.

Final Thoughts

Now that you know how to endorse a cheque, you can ensure that your money is deposited quickly and without any issues. Remember to spell your name correctly and to use the proper type of endorsement for your needs. With these tips in mind, you’ll be able to endorse a cheque like a pro!

FAQ

Where to sign a cheque?

The endorsement area is located on the back of a cheque, typically in the top-right corner. This is where you’ll sign your name to endorse it. 

Can I deposit a cheque for someone else?

Yes, you can deposit a check for someone else. You shouldn’t run into any difficulties as long as the check is endorsed with the payee’s signature or the words “for deposit only.” However, it is preferable for the recipient of a check to make their own deposit for the sake of financial security.

How to endorse a cheque?

To endorse a cheque, sign your name on the back of the check in the endorsement area. You can also write “for deposit only” or include other instructions for the payee. Be sure to spell your name correctly to avoid any delays in processing the check.

ABOUT AUTHOR

When Angela combined her deep-seated love for linguistics with her growing interest for finance and money management, she struck a gold mine. She’s scoured the internet far and wide for all things related to money and finances, including payments, budgeting and investing. Now she’s eager to share her knowledge and skills with the world, determined to make it a better place. In her free time, she loves to read a good book.

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