What term means to sign the back of a check made out to you so it can be cashed or deposited?

• A. Direct Deposit
• B. Emergency Fund
• C. Endorse
• D. FDIC Insurance

Answer: (C)

Endorsing means signing the back of a check to authorize its cashing or deposit. This signature on the back shows you’re transferring the right to collect the funds to the bank, so the check can be processed and paid out to you. There are different ways to endorse, such as a simple signature, which permits cashing or deposit by anyone who presents the check, or a restrictive endorsement like “For deposit only,” which limits the check’s use to your account. The other terms listed refer to unrelated banking concepts: Direct Deposit is electronic transfer of funds into your account; an Emergency Fund is money set aside for unexpected expenses; and FDIC Insurance protects deposits at banks up to certain limits.