PhilFAQS

Time to revisit another old favorite subject here at PhilFAQS, where we answer your questions about living in the Philippines.  This has certainly been covered before, but people search for the subject continuously and I am here to try to give them what they need.

I last wrote at this on length in When You Need Money Just Write Yourself A Check | PhilFAQS a while back.  I see a lot of searches coming here to my bog about living and making a living in the Philippines that may not be relayed to the Philippines … they may just be about how to write yourself a check.  It’s simple, but something that apparently isn’t covered much in schools … people have to figure it out for themselves on the fly.  Here goes:

If you have a checking account, you can write yourself a check from that account, just as if you were writing a check to anyone else that you wanted to give some of your own money too.  Obviously all normal rules and regulations for your bank, your home country and the country you are writing the check in apply, but the banking rules of the Philippines and the US are quite similar, so it is likely that if you write a check in your US home town to pay your electric bill, you can write it to yourself here in the Philippines.  This is how my bank wants to see my checks written out … as always, YMMV.

I typically “live” off my US dollar account here in the Philippines.  Each month I go to the bank, usually on the first banking day of the month with a check written out to myself and a deposit slip filled up to deposit the check into my account.  On the front of the check 9the payee line” I write my full name as shown on my bank account.  Years ago I used to just write a check for “cash” rather than to myself specifically.  This is still legal in many banking jurisdictions, but it’s a bad security practice and you certainly wouldn’t be able to cash (here we say “encash”) the check over the counter anyway, so go with the flow,

On the left side of the reverse of the check, in the place for the endorsement I write the words “For Deposit Only” and when I am standing in front of the teller, ready to hand over the check, I then sign my name and then print my name under the signature.  This is called a “restrictive endorsement”, meaning that the bank is not supposed to encash the check over the counter or use it for any other purpose than to put the money in my account.  I do not sign the check before I am at the teller as a precaution against theft by loss of the check, even though, theoretically, the restrictive endorsement adds a level of protection.  Belt and suspenders for me, that’s my motto.

There are two schools of thought on whether the restrictive endorsement should include the receiving account number or not.  You do have to write the account number on the back of a check that you are depositing. It is sufficient to write "For Deposit Only." Some security experts advise that writing your bank account number on the back of a check is a security risk in that it exposes your account number to third parties who may handle the check.

I personally side with this point of view, but on the other hand, if you do not write the account number on the endorsement you may risk the bank confusing your check with someone else’s and depositing something to the wrong account.  Totally your decision on this matter.

If you are accustomed to British-based banking systems, don’t get yourself all crossed up .  In Great Britain and other countries who pattern their banking laws after the “mother country”, it is common practice to cross a cheque which tells a bank not to cash it across the counter. The cheque must be paid to a bank (e.g. into a customer’s account). If a bank does cash the cheque it may be liable for any loss suffered by the true owner.  Crossing a cheque means drawing across the face of the cheque from top to bottom two parallel lines, with or without the words ‘not negotiable’ between them. A crossing may be added by you when you make out a cheque or by any person who obtains possession of your cheque.

I have received two reasonably authoritative answers to the question, “is it acceptable or necessary to cross a check/cheque here in the Philippines”?  Problem is, the answers are directly contradictory.  One source says “yes”, the other says “no”.  Welcome to the Philippines.  My personal advice?  Don’t bother.  It is not necessary for your protection since the check doesn’t become “live” until you sign it when you hand it to the teller.  Also, I lived for some time in the UK, with both a Pound Sterling and US Dollar bank account and didn’t even know what ‘crossing a cheque” meant until years later when I looked it up in response to a reader’s question here.

Once the check is correctly deposited, you’ll be in the clearing process.  Although some banks advertise they take less time, mine still takes about a month to clear the check … that is to make the money actually available in my account.  To live off your dollar account, then, you must plan ahead and keep track of what you have on deposit and what will be “maturing” in the current month.  This is a real thorn in the side for some folks.  The advantage is, I never have to do anything more complex than write that one check per month and my bank charges no fees for a deposit like this.  Again, check before you set up a banking relationship here, because the clearing times and per check charges vary substantially.

Now how do I get my hands on and actual cash, US or Philippine?

• I make a cash withdrawal, over the counter in US dollars (this is manly if I want to exchange dollars for pesos somewhere other than the bank, or I am traveling outside the Philippines … just so I have easily convertible cash in my wallet)
• I do an over the counter conversion and transfer from my US Dollar account to my Philippine Peso account, so I can use my Philippine ATM card in any teller machine to get pesos in hand.
• If I just want Pesos, here and now, I fill up a withdrawal form for my US dollar account in the amount of dollars that equals the amount of Pesos I want at the current days rate, and when I present it to the teller, so/he will do the conversion as part of the transaction and hand me the correct amount in Philippine Pesos.

That’s about it for writing yourself a check here in the Philippines.  Better look in m,my wallet and see when I have to go to the bank again.

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