The clearing check had its heyday before electronic banking and finalized cashless payments were introduced. Transfer checks were used by private individuals as well as by companies. The advantage of the crossed check is that it can not be paid out on presentation in cash, but basically an account, current account or savings account, must be credited. Abuse was therefore excluded as the beneficiary was identifiable.
The same criteria apply as for a check
For a crossed check to be valid, it must fulfill an eighth criterion in addition to the seven classic criteria that a check must have. In principle, each sheet of paper, if it satisfies the following conditions, can act as a check.
- The word “check” must appear in the text on the document.
- The name of the bank that is instructed to make a certain payment must be stated (related institution).
- The amount of money to be paid out must be in numbers and words. In case of doubt, the tendered amount applies.
- The text must contain the binding statement, for example “pay upon presentation of this check”.
- The date of the exhibition must be named.
- It must be clear where the check was issued.
- Without a signature of the debtor, the check is worthless.
If the document contains all these criteria, it is a legal check, but it can be paid in cash. In a crossed check, therefore, there is an eighth criterion. This type of check must have the three words “just for clearing” imprinted or written down. Usually, this passage was top left across. Not legally regulated, but commercially recognized were also two parallel lines, which also run diagonally above the check form on the top left.
Credit is made under reserve
Anyone who has a clearing check on their account and wants to immediately dispose of the amount must reckon with the fact that this is not possible. The credit note on the account of the beneficiary is made under the reservation that the bank of the check issuer can actually debit the sum of the account of the exhibitor. The credit period is up to ten days.
Order check even safer
While a crossed check already offers a certain security to the involved parties, this is even greater with an order check. This check may only be redeemed by the beneficiary whose name is mentioned in the name line that exists only for this check variant. All other types of checks can also be given to third parties by passing on the endorsement. The merchant A, for example, pays an invoice at B with a check. B owes C the same amount and endorses the check received from A to C. So C can cash the check. A check, whether a cash, clearing or order check, is not a variant of the loan.