A check guarantee can be provided by a consumer or a bank. There are certain steps taken to guarantee a check both on the consumer and the bank side. This article has information on the check guarantee process and choosing a check guarantee service.

The Two Meanings of Check Guarantee

A check guarantee can be two different things. For one thing, it can be a service to a person who holds an account at a bank and to merchants who accept check payments from those depositors. In this case, the bank provides a check guarantee card by which the payment by check to a business is guaranteed to be covered if certain procedures are followed. The check guarantee procedures include the following:

• the check must be made out to a business
• the check guarantee card number is written on the back of the check
• the check is signed in the presence of the retailer
• the retailer checks the signature on the check against the signature on the card.

If these check guarantee steps are followed, then the check can neither be stopped by the customer, nor can payment be refused by the bank that issued the card on its own checks.

This type of check guarantee is in force in the United Kingdom as of the writing of this article, but is due to end on June 30, 2011.

The second kind of check guarantee is also called a check verification service. This type of check guarantee is a kind of insurance for merchants, but not every check guarantee service operates in the same way. Some offer services based on your business type, taking your industry and its particular characteristics and risks into account. Here are some examples:

• FreeCreditCardProcessing.com offers Check Guarantee enrollment for free as part of its merchant account services, along with free credit card terminals, free setup and activation, free gift card enrollment, etc.

• Payment Solutions, which claims to be the leading check guarantee service company in the United States, offers check guarantee as a discrete service which includes guarantees on all checks, guaranteed payment on bad checks, and a simple procedure for check handling and acceptance.

Choosing a Check Guarantee Service

When you consider a check guarantee service, you may wish to consider finding a merchant account that offers such a service in order to keep all of your transaction services with the same party. You should check websites and other information to make sure that they are up-to-date, and make sure that the company is legitimate—with proper licensing, bonding, and insurance—and well-reviewed by current clients. Find out about their schedule for payments on bad checks, the hours during which you can receive customer support, and of course, the cost of the service, which is likely to vary with the industry you are in. For example, if you generally receive large checks from one-time customers, your fees are likely to be higher than someone who receives moderately-sized checks from many ongoing customers.

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