Types of Checks Offered by the Banks

There are several types of checks.
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Banks offer various types of checks for its company and individual clients to allow them to use them as specific payment instruments. The primary use of the check is to provide payment for a large sum of money without the burden and risk of carrying cash. It also allows providing an exact payment amount without the need to count real money. For check forms of payment, the amount gets debited on a bank-to-bank transaction made by the payee or receiver of the check.


Using a Personal Check

A personal check is provided to a checking account holder of a bank. The check books for a personal checking account allows the account holder to pay individuals and institutions without having to pay cash by simply issuing a check where the drawee (account holder) writes the name of the payee (receiving party), the exact amount to be paid in words and figures and the date of payment, then he signs the check to validate the processing of the transaction to be undertaken by the payee.


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Writing a Company or Business Check

A company or business check is similar to a personal check except that the bank account holder is not a person but a company, a business entity, an organization or a foundation. For these types of checks, the drawer pays individuals or other groups or entities in the form of a check duly signed by the company's representative or representatives, and the fund is drawn from the company's checking account using a relatively the same process as that of a personal check.


Getting a Cashier's Check

A cashier's check, also referred to as a manager's check, is a type of check purchased by a person using cash paid to the bank in exchange of the said check. It is also possible that a request for a cashier's check simply debits the said amount from the person's account housed in the same bank issuing the cashier's check. This is usually the option for a person who needs to pay a large amount of money, but the payee doesn't accept personal checks as a mode of payment. For example, you could get a cashier's check for a major purchase like a vehicle.


Unlike a personal check that requires a clearing date, a cashier's check is guaranteed by the bank and is usually treated as cash because most banks clear it instantly. However, these types of checks are often used in scams, so they need to be verified as genuine.

Using a Traveler's Check

Traveler's checks are widely used as drafts for a person traveling to another country. This type of check allows the traveler to convert money into the currency of the country of destination without the risk of having to carry a huge amount of cash during the trip. The use of a traveler's check is bound by specific legal conditions based on the control regulations set by the central bank of a particular country. This check is also accompanied by necessary shipping documents to allow the traveler to legally bring such amount to the country of destination.