When you set up a business, regardless of its type, you’re going to need to make financial transactions. Cash is easy but not secure and credit card companies charge fees for their service; business checks solve both these problems.
Using a business check also helps create a professional business image, it gives you legitimacy and promotes trust. As a document that can include your business name, address, and logo, a check also offers an opportunity to promote your brand.
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Not only this but using business checks can be incredibly helpful with your accounting, and in keeping finances separate from personal or other business interests. It creates a paper trail that clearly marks out the transaction was for the specific business named on the check, and names all parties involved.
A business check is like a personal check, but with some key differences. While your personal checks might have a fun image as the background, to show off your personality, a business check should appear more professional.
It will contain your business name, company logo, and address, presented in a legitimate and business-like manner. As it is your company’s money the check is moving and protecting, you’ll want to make sure it has the best security features too.
Where can you get business checks from?
You could ask your bank to supply and print checks, but this can take time and become costly. The preferred option of most businesses is to find a reliable supplier of secure business checks which you can print yourself when they are needed.
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These can come with various levels of security features, from watermarks and heat-sensitive icons to security coatings and holograms. A quality provider will also supply checks which can be printed directly from bookkeeping software such as QuickBooks.
How should you endorse a business check?
The sender of a check will complete most of the information on the front side. This includes their name, address, contact number, and the account information from which the funds are to be withdrawn.
It also includes the monetary amount to be paid and the details of the person authorized to receive the funds. This person is the payee, and it is they who will confirm their identity and right to receive funds by endorsing the check.
The first thing any payee endorsing a check should do is thoroughly examine the details to make sure they are all correct. The next steps depend on the manner of the check or payment.
- Blank checksThese are the most straightforward and are used when money can be paid into any account authorized to the signatory. The payee simply needs to sign their name on these checks, and add their business name if different, and the endorsement is complete.
- Restricted checks
This is when the amount on the check should be paid into a specific account only. For this, after the signature and business name, the payee should state their job title (i.e. CFO) then write “For deposit only” and the authorized destination account.
- Fully endorsed checks
These checks allow the amount stated to be passed on to a third party on the authorization of the signatory. In addition to the signature, business name, and job title, the payee should add “Pay to the order of” and the recipient’s name.
Many businesses receive checks in high volumes, so it is possible to save time by replacing signatures and other repeated information with a printed stamp. The individual information for restricted and fully endorsed checks will still need to be added, whether by hand or adjustable stamp.
So long as they are used properly, as described here, business checks can provide an easy, secure, and flexible way of conducting your business. With a quality supplier, any business can easily print and use professional checks allowing them to concentrate on the other matters of growing their business.