If you own a business and have clients writing out checks to your company, you may find yourself in need of a business check cashing service. The following are six things you need to be aware of regarding business check cashing.
Cashing a business check can be more complicated than cashing a personal check.
You cannot simply cash a check that is made out to a business the same way you can cash a personal check. A business check is made out to an entity rather than to an individual. This complicates the process of cashing a business check.
Some banks do not offer business check cashing.
It's important to find a financial institution that offers business check cashing services if you are a business owner with clients making out checks to your company rather than to you personally. Some banks may not offer business check cashing.
It's easiest to cash a business check if you have a business checking account.
Having a business checking account can make it more simple to cash a business check. However, some business owners may not have opened a checking account in their company name. However, even if you have a business checking account, you generally won't be able to cash a business check immediately unless you have at least as much as the check is written out for in your business account.
Banks won't give you the full value of the check until the check has cleared if you don't have adequate funds to secure the check in your business account in the meantime.
Business checks made out to a sole proprietorship can generally only be cashed by the business owner.
It's relatively simple to cash a check that is made out to a sole proprietorship. That's because a business owner with a sole proprietorship is typically considered to be the same entity as their company.
For other types of businesses, you may have to be a designated signatory to cash a business check.
Things get more complicated with businesses that are made up of partnerships, corporations, or limited liability companies. In this case, the company is not made up of only one person. As such, for these types of businesses, there should be designated signatories who are permitted to cash checks written out to the company. Only these designated signatories can cash checks made out to the company.
Business check cashing services can conveniently cash business checks.
Business check cashing services can simplify the process of cashing business checks. For a small fee, these services will cash business checks if the individual cashing the check presents some form of identification such as a driver's license or a passport.Share