What Is a Personal Check?
A personal check is a kind of check designed for your personal use. It’s an item that tells your bank to transfer funds from your personal checking account to the payee’s account. Naturally, if you’re a payee, personal checks are used to transfer money from someone else’s account to your own account.
What are the times when you should make use of personal checks?
Personal checks usually come in useful when the payer requests that you pay by check. Small businesses aren’t able to accept debit or credit cards. In contrast, some won’t let you pay in cash for transactions that exceed the specified amount. Such cases bring personal checks into the picture.
But, if you’re a small business It is crucial to keep in mind that personal checks are not security checks. This means that the recipient can make a business check for any amount of money. So, they might have insufficient funds in their personal bank account. This means that when you visit the ATM to withdraw the check, it will bounce. It also means that you will not be paid until the beneficiary has enough cash in their account at the bank.
However, when you choose to make a personal check, with no funds to cover the cost, your might be charged an overdraft charge.
How to Avoid Bouncing Checks as a Business Owner
If you’re a commercial owner that accepts inspirational checks on paper, it’s possible to run into problems in the event that customers are paying using personal checks. This is if your client has not enough cash on their account at the bank. It is a good idea to suggest asking your customers to provide the cashier’s check or certified checks instead to avoid bounced checks. Let’s take a closer review of what these kinds of checks are.
Cashier’s Checks
The check is used to withdraw money from the total fund of a bank for the beneficiary. It’s typically executed by a bank representative. It also ensures that the individual receiving the cashier’s check gets the full amount due. In addition, once the check is drawn, the check is added to the check writer’s account. Lastly, the money is transferred by the financial institution.
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Certified Checks
Furthermore, a certified check is the same as a cashier’s or cashier’s check. However, instead of obtaining funds from the lender’s accounts, the lender will verify that the payee has sufficient funds in their savings or checking account. In addition, the bank will confirm that the signer is the account holder. They are again ensuring that the person or business receiving the check is paid the full amount owed.
Moreover, both certified and cashier’s checks are commonly used to make big purchases like cars or home renovations. They can also be used to down payments on a property.
Similarities Between Personal Checks and Business Checks
Personal business and personal checks are more different than they are alike. However, they have a few things in common. In the first place, you can cash or deposit a check regardless of whether it’s for business or personal. The procedure differs; therefore take a look at this article to find out how to make use of both types of checks.
Another commonality in business and personal checks is the fact that they include the same basic information. Along with a routing number of the bank, a check has dates, payees or check number, the amount payable, and the signature line.
Differences Between Personal Checks and Business Checks
As we said, business checks and personal checks are pretty different. They differ in terms of size, design, print, cost, security features, and the way they are used.