Question

Why should "for deposit only" be written on a check along with the bank account number when it is endorsed? A. It saves time at the bank if it is already written on the check. B. Banks require that information be written on checks. C. If the check is lost, nobody else can cash it or do anything with it. D. It is a good reminder that the check is for deposit, not for cashing.

Answer 1

C. If the check is lost, nobody else can cash it or do anything with it.

Explanation:

When writing "for deposit only" in a check, this is an indicator that the check can only be deposited in the account and cannot be cashed for any reason. This is called restrictive indorsement, this type of indorsement does not allow anybody else to cash in or deposit the check anywhere other than the bank and the account number written on the check.