Wednesday, 28 October 2009

How To Write Checks (Cheques) in Israel

Writing Checks in Israel
A guest post by Hannah Katsman of AMotherInIsrael.Com and CookingManager.Com.
Israel is moving toward a paperless economy, but checks will be around for a while. Checks may look similar to checks from your native country, but there may be important differences in the way they are used.

Writing the check
Checks may be written in English or Hebrew. Pay attention to the following things:
  1. Date: Use the Hebrew month and date if you like, although the payees, or their accountants, may not appreciate it. If you use numbers remember to put the day of the month first: 3/7/09 or 3.7.09 is July 3, not March 7.
  2. "To" field (לפקודת) . You may be asked to leave this blank. It’s legal for someone to take your check, enter another name or business, and use it for a different purpose. They may also want to avoid reporting the income or paying VAT. Even if you have written the name of the recipient, a check can still be transferred or stolen. I have been told that Israeli banks are more lenient about misspelled names than in other countries. (Actually, Israelis are lenient about misspelled names in other contexts too, including the phone book.)
  3. Crossing Checks. To prevent the recipient from writing another name in the “to” field, “cross” your check by placing two parallel diagonal lines above the name of the recipient. Some printed checks already say lamutav beelvad למוטב בלבד, for the recipient only. Always cross checks that you mail or send to school with your kids. Always ask for a receipt, and hold on to it.
  4. Amount: Write the amounts in the two fields, once in digits and and once with text.
  5. Signature:The bank once called me because a clerk decided my signature wasn’t similar enough to the signature on the card on file at the bank. Your signature can be in English or Hebrew, just be consistent.
Other things to know:
  1. Write checks carefully. Banks return checks for minor things that would not be an issue elsewhere. If you make a mistake cross it out, write the correction, and sign underneath the correction. If you are a good customer the bank may call and offer to correct a mistake instead of returning it (for instance, if you write the previous year by mistake).
  2. Cashing checks: Endorse the check and include your account number. You can deposit your check at your bank’s ATM without an envelope. But check the date, because the bank may charge you for deposting a post-dated check.
  3. Your bank statement lists the date a check was cashed and for what amount, but not the recipient.
  4. For school fees, you may be asked to write the child’s name, ID number or class on the back. This is legal.
  5. Canceling checks is illegal. But if a check is stolen or a contract has been broken, provide written proof to the bank. You will need to sign a form and pay a fee.
  6. Postdating checks is legal. Rent, school fees, and courses are often paid by postdated checks according to a set schedule. More organizations allow use of debit cards instead,a cheaper and easier option.
  7. Israeli banks allow overdrafts, although the laws are stricter now. Many stores accept checks. As in the US, there is a hefty fee for bounced checks. If you bounce more than ten checks your account may be frozen.
  8. Instead of writing a check, you may transfer funds directly from your account to that of someone else.
  9. Ordering checkbooks: You order checkbooks through your bank via the teller, bank machine, or checkbox on the bank deposit envelope. You will be charged both for the checkbooks and again every time a check is cashed, as it is considered a “line” on your bank statement. That’s why many Israelis prefer debit card, which use only one line on the statement.
  10. Tashlumim. תשלומים When you have the option of dividing a fee into equal payments (tashlumim), divide the full amount by the number of payments and write a check for each one. For instance, if you need to pay NIS 2000 in four tashlumim, you could write out four checks of NIS 500 for the 1st day of the next four months or whatever schedule is specified. You could also have payments set up on your debit card.
  11. Checks are valid six months from the date they are written.
What experiences with checks have you had? Tell us in the comments.
Hannah grew up in Cincinnati, Ohio and has lived in Petach Tikva, Israel for 19 years. She blogs at A Mother in Israel on parenting, women’s health issues, and life in Israel. In honor of this guest post, she compiled this list of useful posts for new olim. Her new project, CookingManager.Com, is devoted to kitchen tips that save time and money.

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