A notation on a negotiable instrument, typically showing within the lower-left nook, gives an area for the payer to point the aim or motive for the fee. For instance, a test written to a landlord would possibly embrace “Hire for July” on this space, whereas one remitting fee to a contractor may state “Bill #1234.” This notation is non-binding and doesn’t legally dictate how the payee should allocate the funds.
This informational space serves a number of sensible functions. It assists the payer in monitoring bills and reconciling financial institution statements. For the payee, it might support in figuring out the fee’s meant utility, significantly when a number of excellent invoices or obligations exist. Traditionally, this observe developed as a easy technique for record-keeping, predating subtle accounting software program. Its enduring presence on fashionable checks highlights its persevering with utility as a handy reference level.
