Definition - What does Endorsement mean?

An endorsement is when a person signs his or her name on the back of a check or other bill of exchange in order to essentially transfer ownership to another party. The purpose of endorsements is to have a way to easily transfer the money (or property such as a vehicle when a title is signed) that is represented in the check to other people.

Justipedia explains Endorsement

An example of an endorsement would be a person who receives a check for $100.00, and who then signs his or her name on the back of it and gives it to another person. The endorsement could also include instructions such as "Pay to Alfred," etc. This is not necessary to transfer ownership, however. All that is needed to transfer ownership is the endorsement and the physical giving of the check to the other person.

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