More types of cheque in india interesting and relevant information regarding cheques and their related aspects is provided in the below article. Bank exam aspirants are advised to bookmark this page to keep tabs on all the important information as elaborated here. While we can’t know for sure when uncertainties may arise or how much they would impact us, it is always a great idea to be prepared with contingencies. Here are the top 10 ideas to mitigate any financial risk especially in the background of global economic slowdown.
A bearer cheque is a type of cheque in which the holder of the cheque has the right to receive the payment. The person who presents the cheque to the bank for payment will receive the funds, regardless of who the cheque is made out to. Bearer cheques are considered to be less secure than other types of cheques because they can be easily lost or stolen and cashed by anyone who has possession of them. Bearer cheques are now phased out in many countries and are not in common use. They are only used in some cases for the movement of funds between the banks.
- No cash payment is permissible from the cash counter of bank branch.
- Account Payee Cheque can be identified by, a name account payee written on the top-left corner of the cheque.
- • Similarly, the amount mentioned on the cheque cannot be altered.
- Cheques that are dated for enchantment/deposit on a future date are called post-dated cheques.
- It is considered as good as cash and can be used for large transactions or when the payee requires a guaranteed form of payment.
- Foreigners, for convenience, carry what is known as a traveller’s cheque.
A cheque is a common method of money transfer among merchants and small businesses. This is the same as the account payee cheque but no third party involvement is required. The amount shall be transferred directly to the payee’s account number. For the record, the type of cheque depends on the purpose that both parties (payer and payee or drawer and drawee) seek to accomplish through it. A crossed cheque has two parallel lines and can only be credited to the payee’s account.
Types of Cheque in Indian Banking System
One can read further to know more about cheques, starting from a cheque definition to the different types of cheques. When the date mentioned in the date column along with the payee name of order or bearer cheque is yet to come than the current date, then it is called postdated cheque. A bearer cheque is the type of cheque that allows the person bearing or carrying the cheque to the bank to receive the payment specified on the cheque. These cheques have the words “or bearer” printed in front of the name of the payee. It means that the amount of the cheque issued can be either received by the payee or the bearer.
Open cheques are considered to be less secure than crossed cheques, as they can easily be lost or stolen and cashed by someone other than the intended recipient. Open cheques are less common in use and most of the time banks discourage using them. They are mostly used for transactions between known parties where there is trust between them. A crossed cheque is a type of cheque that has been marked with two parallel lines, usually across the top left corner of the cheque.
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It is important to ensure that the cheque is filled out correctly and that sufficient funds are available in the account before writing a cheque to avoid bounced cheques. An open cheque is a type of cheque that can be cashed or deposited by anyone who has possession of it. Unlike crossed cheques, open cheques do not have any special markings, and do not indicate the account to which the funds should be credited.
In this process, any cheque exceeding Rs. 50,000 involves reconfirming the details. Only if there is consistency in the details the cheque is honoured. Let me know if I have missed any other types of cheques in India. If you have any questions regarding types of cheques feel free to comment so that we can have a discussion. If you have found this post helpful, share it with your loved ones.
Ante-Dated Cheques
The amount will be transferred to the account of the person specified on the cheque. The issuer of the cheque has an account (savings or current) with the bank to which it is connected. There are various types of checkbooks that depend on the type of account you have. The features, benefits and offers mentioned in the article are applicable as on the day of publication of this blog and is subject to change without notice.
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• Sometimes, banks may deny cheque processing for a few reasons, such as low account.balances, signature mismatch and more because they are not legal tenders. • A cheque consists of cheque number, MICR, and entries to mention the payee’s name, drawn amount, and signature of the drawee. A blank cheque is one that has the sign of the issuer, and no other details are filled in. Blank cheques pose a high risk because if lost, anyone who finds it can fill in any amount and issue it to themselves. In case of a crossed cheque, the drawer must draw two lines at the left top corner of the cheque. The payee’s identity may be cross-checked by the bank before encashing the sum of money.
The person who issues the cheque, such as a customer or account holder, is known as the drawer. Cheques come in various types, each designed for specific financial transactions in India. Understanding these types ensures effective management of financial dealings.
This transaction has to be handled very delicately as it may lead to some serious banking fraud. A cheque older than 6 months is called a stale cheque however, they are still valid and can be used for transactions. If a drawer wants the payee to apply for withdrawal or transfer of money after the present date, then he/she can fill a post dated cheque. The drawee therefore for any cheque is always the bank as they are the ones tasked with the disbursal of the funds.
- We will also provide useful tips on when and how to use cheques safely.
- In this blog post, we will discuss the various types of cheques available in the Indian banking system and how to use them.
- A mutilated cheque is a cheque that has been subject to damage or alteration.
- For any further information regarding the banking terms or the government exam syllabus or information regarding the same, candidates can turn to BYJU’S for assistance.
- Cheques offer a plethora of options that meet several requirements of users.
The amount mentioned on the cheque is only transferred to the bank account of the payee whose name is mentioned on the cheque. No cash payment is permissible from the cash counter of bank branch. Understanding the various types of cheques equips individuals and businesses to navigate financial transactions more effectively. Each type of cheque offers unique benefits tailored to specific needs.
What are the different types of cheques?
So if a payee moves to the bank to get withdrawal for a cheque which was signed 3 months ago, the cheque shall be declared a stale cheque. To ensure that it is an account payee cheque, two lines are made on the left top corner of the cheque, labelling it for “A/C PAYEE”. It’s important to note that these types of cheques can be subject to specific conditions and regulations imposed by individual banks or the Reserve Bank of India (RBI). Therefore, it is advisable to consult with your bank to understand their specific policies and guidelines regarding the use of different types of cheques.