Bearer Check

A bearer check is a check that can be cashed by any person who presents it at the bankor corresponding financial institution.

A bearer check is a payment document where the name of the beneficiary is not indicated so that anyone who has it in their possession and presents it to the Bank may collect it.

Bearer check characteristics

Below we describe the essential characteristics of a bearer check:

  • The beneficiary is not indicated
  • It can be charged by anyone who carries it, that is, who has it in their possession and presents it to the Bank
  • It is generally used for the payment of small amounts of money or when it is not well known who should go to collect it

Agents involved in the bearer check

Three agents are involved in the preparation and collection of the bearer’s check:

  • The drawer: is the one who takes charge of the amount to be paid established in the check. The drawer is the one who gives the payment order, puts the amount to collect and signs the check.
  • El Librado: is the financial institution where the drawer has an account. The drawer is the intermediary that delivers the money to the bearer of the check.
  • The holder: is the person who holds the check and presents it to the Bank to cash it.

Advantages and disadvantages of the bearer check

The great advantage is that it allows flexibility so that anyone can go to collect it. This can be useful in some cases such as when a company has several employees with different time availability and can freely choose who to send to cash the check.

The disadvantages are your risk of loss or theft. When the check falls into the hands of others, the person cannot be charged.

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