Knowing how to read a check heightens check cashing safety and helps avoid costly mistakes. Because it’s a simple process, many don’t fully read the entries, overlooking errors and omissions.
What Should Be Noted
Whether it’s a personal check, a business check, or a payroll check, common elements must be present and legible.
Payee: To whom the money will be paid. If the bank teller cannot read who the payee is, he or she is not obligated to cash or deposit the check. Note how the entry name is spelled; it’s that spelling that must be written first on the back of the check when cashing.
Date: When the check was written. Because no check is valid indefinitely, the time clock begins on the date it was written. Financial institutions are not required to accept qualifying entries to cashing date, such as “void until” or “post-dated until” or similar entries.
Amount: The currency should be locally legal tender. In the United States, use the dollar sign; in Great Britain, use their currency sign that looks like an italicized L with a small horizontal line through it. The payable amount should be numeric.
Written amount: A safety measure to ensure the numeric entry hasn’t been illegally changed, the amount to be paid is fully written. For example, if the numeric entry reads, “$195.98,” using the “dollar last” method recommended by banks, the written entry would read, “One hundred ninety-five and 98/100 dollars.” Note the cents entry is displayed as a fraction of 100 pennies. There is no “and” between “hundred” and “ninety-five.”
The name and address of the account holder should be pre-printed in the upper left corner of the check.
Opposite that, the check number is pre-printed.
Below the written amount line, the issuing financial institution is displayed. There should be the name and branch or main address. Often, they give the primary customer service contact number, as well.
Along the bottom edge of the check are two unlabeled numbers. These designate the account from which the funds will be debited and a routing number which identifies the branch location of the account.
One final line is important to note: The payer’s signature line. No check-cashing business or financial institution will honor an unsigned check. Also, the signature presented on the check must match the signature of record with the financial institution where the account is based.
US Department of the Treasury, FAQs: Currency; found at: http://www.ustreas.gov/education/faq/currency/legal-tender.shtml
Federal Deposit Insurance Company; FDIC Consumer News-Spring 2000; “Paper or Plastic,” found at: http://www.fdic.gov/consumers/consumer/news/cnspr00/cvrstry.html
Bank of America, Customer Service; 1-800