Define restrictive endorsement.


A restrictive endorsement, which might also be called a restricted endorsement, is a written phrase on a check or other document that has a connection to finances. This sign imposes restrictions on the check, for example, restrictive endorsement “Paid in full”.


When somebody receives a check or a bill, they should endorse it in order to be able to cash or deposit it. The procedure of endorsement in many cases means just signing the appropriate name on the back of the financial document. On most checks, there is a special area for endorsements.

It is significant to spell the name of the payee correctly so that it corresponds with what is written on the front and also to place the signature exactly in the intended area. Usually, a check with a signature is regarded as endorsed. However, this method, also known as a blank endorsement, is an appropriate decision only if a person is going to cash or deposit his check soon. In other situations, additional caution measures should be taken.

Choosing a restrictive endorsement is the right way to make sure that the deposit goes into the appropriate account.  When one makes up his mind to use this kind of endorsement, they have not only to sign the check but also to give their account number and write a sentence, including special instructions.

Restrictive endorsement example sentence can restrict the use of the check, for example, indicates, to whom it is allowed to transfer the document: “for transfer only to John Jackson”. One of the most widely used phrases on bills and notes is restricted endorsement “For deposit only”. This sign means that it is permitted to deposit the check solely into the endorser’s account.

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