The 3 Checks You Should Know About
There are three main types of checks, as defined by the Uniform Commercial Code. The first is order checks, which are the basic form of checks with which most citizens of the United States are familiar. In an order check, the drawer orders that a certain amount of money be made payable specifically to a single payee, or endorsee.
The second type of check of significance is a bearer check. Bearer checks are not payable to one specific individual, as order checks are. Instead, bearer checks are payable to the bearer of the check itself, regardless of who that individual may be. These checks are, of course, somewhat riskier than order checks, as they can be used illegitimately or in unintended ways if they are physically lost by the holder.
Counter checks make up the third primary type, as checks issued from banks. They are checks in which the drawer and the drawee are both technically the bank, and they can be used to make withdrawals from the bank for those individuals who run out of their own checks.
Checks have, of late, seen less and less use, primarily because new and more efficient forms of payment have come to prominence. Debit cards and checking cards often fulfill much the same purpose as checks without requiring the actual paper documents which are actually costly for banks to produce.
Checks are also often considered much more time consuming than these newer methods of payment. In general, while it is unlikely that the check will be phased out entirely, it is very likely that checks will continue to decline in use as other methods of payment become more useful.
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