What is the purpose of a qualified endorsement?

A qualified endorsement serves a specific purpose in the banking and financial world. It typically includes the phrase "without recourse," which indicates that the endorser is not responsible for any issues that may arise if the check is not honored by the bank on which it is drawn. This type of endorsement allows the endorser to pass the risk to the next holder of the check, protecting them from liability should the check bounce.

The other options do not accurately represent the function of a qualified endorsement. For instance, a direct cash exchange or immediate fund transfer do not align with the characteristics of a qualified endorsement. Additionally, allowing deposits without conditions is also not relevant, as a qualified endorsement is specifically concerned with the responsibility and liability of the endorser.