Through deposits of cash and credit instruments the customer builds up his account with the bank. This bank credit confers upon the depositor the right to draw checks with which to settle his debts and at the same time impose upon the bank the obligation to pay those checks on demand in cash. The responsibility for the outflow of cash is assigned to the paying teller of the bank. In some respects his position is just the reverse of that of the receiving teller. The receiving teller deals only with the bank's customers, for they alone bring deposits to his window. On the other hand, the paying teller comes into contact with the general public, for the depositor of the bank may draw checks in favor of any one person, and such a payee may then order the paying teller to honor the instrument. The work of the receiving teller involves less risk, for errors committed at his window may readily be discovered by assistants later in the day and then corrected. But if the paying teller once overpays the amount of the checks presented to him, this disbursement generally is beyond his control to adjust.

The general function of the paying teller is to effect all disbursements of cash and shipments of currency for the account of the bank. These payments are made for the following purposes: (1) settlement of balances owing to other banks, (2) cashing of checks, (3) preparation of pay rolls, (4) certification of checks.

In all banks the paying teller has sole responsibility for honoring checks drawn by the customers. The payees usually deposit these instruments in their own banks, which present them on the following day for payment through the local clearing house. These clearing-house balances owing to other banks were formerly paid in cash by the paying teller, but they are now settled by simple bookkeeping entries on the ledgers of the Federal Reserve Bank.

A check may be presented by a payee directly at the window of the drawee bank, which is then called upon to cash it if the holder can prove that he is entitled to the money. In making these disbursements the paying teller must note carefully such factors relating to the instrument as the signature, indorsement, date, amount, balance of the account, and stop-payment orders.

The signature of the drawer is verified from a file containing specimens of the handwriting of all the bank's customers. When a check is presented by a person other than the drawer, it is good practice to insist upon indorsement on the reverse side, even if the instrument is filled out to bearer. If a check payable to order is presented by a stranger, it is necessary for him to prove that he is the designated party. This identification may be secured by exhibiting documents such as personal letters and business cards, or by securing an introduction from a customer of the bank.

The paying teller must also observe the date and guard against post- or ante-dated checks. If the drawer has, either through intent or error, postdated the instrument by an advance date, it is the duty of the bank to withhold funds until the specified time arrives. On the other hand, if the holder does not present a check immediately, it becomes antedated, or stale, but payment is usually made by the bank. The teller carefully examines the amount of the check for any-careless discrepancy between the sum written in numbers and in words, and for deliberate raising or alteration. The extent of the customer's credit with the bank is occasionally investigated to find out whether his balance justifies the payment of the checks which he has drawn. At times a customer draws a check to an amount greater than the funds to his credit, and this excess is known as an overdraft, which the bank may refuse to honor. Funds are also withheld from the payee when the drawer issues a stop-payment order. This notice to the bank is written by the customer when he seeks to prevent payment. In summary, the paying teller in cashing checks must guard against forgery, misidentity, postdating, overpayment, alteration, overdraft, and an order to stop payment.

The paying teller's department also prepares the pay roll for those customers of the bank who employ labor on a large scale. These payments are seldom made by checks, but usually in cash. It is necessary to determine in advance the community's demand for the various denominations of. bills and the several kinds of small change. As the work of preparing pay rolls involves considerable clerical assistance, it is not unusual for banks to insist that requests be submitted by their customers several days in advance of the date of payment.

Still another duty of the paying teller is the certification of checks. As previously mentioned, the ordinary check is merely an order drawn by the customer against his account with the bank, but the holder of this instrument has no positive guaranty that it will be honored by the bank, for it will refuse payment if the account has been overdrawn or if a stop-payment order has been issued. In certain types of business transactions, such as sales of real estate, the seller naturally has the right to demand payment before he surrenders his property to the buyer. The transaction may be settled by payment in actual cash, but it is customary to accept reimbursement by a certified check. This is the same in form as an ordinary check, but on its face the paying teller of the bank has signed his name and stamped the expression "certified" or words of similar meaning. This act of the paying teller signifies that the bank has withdrawn the specified sum of money from the account of the drawer of the check and has set it aside for the benefit of the payee. The obligation to pay has thus been transferred from the individual to the bank.

A number of banks combine the work of the receiving and paying tellers in what is known as the unit system. The tellers' windows are arranged in groups of the alphabet such as A-F, G-O, Q-W, and accordingly customers leave deposits and cash checks at the same window. The unit plan saves time for the customer and facilitates the work of the bank, since the tellers handle a smaller number of accounts and thus become more familiar with them.