Sometimes we encounter problems, though, when we write or receive checks. This information is intended to summarize the advantages and the risks involved in writing and receiving checks. It provides some basic information about checking accounts, special types of checks, and the check collection system. It also suggests ways to avoid or minimize the problems that may occur in accepting checks for payments. Checking Accounts C hecks are written orders we use to tell our bank or other depository institutions to pay money or to transfer funds from our account to the check-holder.
Financial institutions offer several types of checking accounts.
The demand deposit account is the most common checking account. Interest-bearing checking accounts are offered by most types of depository institutions. Money market mutual fund accounts that pay market interest rates are offered by some investment companies. Although most of these accounts allow the accountholder to write an unlimited number of checks, there may also be a large per check minimum amount. Check-Writing Tips Remember that a check is a personalized form of money.