What is a signature endorsement?

A signature endorsement is a type of endorsement used to authorize the transfer of ownership of a negotiable instrument, such as a check or a promissory note. It typically involves the endorser signing their name on the back of the instrument, which allows the recipient to cash or deposit it. This form of endorsement signifies the endorser’s consent for the instrument to be transferred to another party. It is crucial for ensuring the legitimacy and traceability of financial transactions.