Bank Cheques, Different type of Cheques

It can be encashed at the counter of the bearer's bank and is transferable by the payee. It serves as a written instruction to a bank to pay a specified amount of money to the payee. A cheque leaf can be used for the purpose of withdrawing, depositing, or transferring funds from one account to another. A post-dated cheque is types of cheque in india a crossed or accounts payee cheque with a future date to meet a financial obligation in the future.

Difference Between NRE & NRO Account

Knowledge of bearer cheques and the risks is crucial for handling financial security threats and possibilities. A crossed cheque has two parallel lines and can only be credited to the payee’s account. When the word ‘’bearer’’ is canceled and the word ‘’order’’ is written in its place, the cheque is called Order Cheques. It can only be issued by a person whose name is mentioned on the cheque. They don’t do any investigation to authenticate the cheque bearer’s identity before making the payment. In short, this cheque is payable to the person who is the payee, or to whom it has been endorsed or transferred.

All about Cheques

Global acceptance of these cheques makes them a reliable option. Post-dated cheques are often convenient but they also have disadvantages. If the drawer’s Bank Account does not have adequate money on the given date, the cheque will bounce and incur a penalty. Banker's cheques are cheques that the bank issues to ensure payment.

If you present a stale cheque, the bank is authorised to reject it and return it to you. A post-dated cheque is issued for a future date and cannot be encashed before the date specified on the cheque. As opposed to other types of cheques, bearer cheques don’t require endorsement. However, they carry higher risks since they operate on the same principle as cash. A blank cheque is a cheque that has been signed by the account holder but does not have any other information filled in, such as the date, payee, or amount. This means that anyone who has the cheque can fill in the missing information and cash it for the amount they specify.

1. This type of cheque cannot be endorsed, i.e., only the payee, whose name has been mentioned in the cheque is liable to get cash for that amount.
2. It can easily be identified by the words ‘or bearer’ printed on them.
3. The payee should also send a notification to the drawer saying that the money needs to be paid within the period of 15 days of receipt of the notice.
4. A post-dated cheque bears a date later than the date it was issued on.

Below mentioned table shows how is a bearer cheque different from an order cheque. An order cheque is specifically in favour of a particular individual or organisation. It may contain words such as 'Pay to the order of' or 'Pay to' mentioned before the payee name. It is a cheque that has been torn or damaged to the point where it is no longer legible or cannot be processed by a bank. An order cheque is a cheque that can only be issued to the person whose name is mentioned on the cheque.

IDFC FIRST Bank Mobile App

The amount shall be transferred directly to the payee’s account number. A cheque older than 6 months is called a stale cheque however, they are still valid and can be used for transactions. An order cheque is the one that has the words “or bearer” cancelled out. It means that only the individual whose name is mentioned as the payee can receive the specified sum of money. In this case, the bank does not check the bearer’s identity before making the payment.

After paying the required amount, you will receive it at your registered mailing address. If you are an IDFC FIRST Bank account holder, new chequebook issuance is completely free of charge. • Cheques are issued only to account holders, so anyone who wishes to use cheques first must open a bank account. A cheque is referred to as a Post Dated Cheque when it is bearing a later date than the one on which it is issued. The person can present this cheque at any time at the bank, but no transaction will take place before the date mentioned.

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. A post-dated cheque is processed only on or after the future date mentioned on the cheque. If your traveller’s cheque is lost, you can receive a replacement.

If you're looking for a reliable banking partner, consider opening a Savings Account with Axis Bank to enjoy these benefits and more. A cheque is a document that tells your bank to transfer the mentioned amount to a person or organisation. There are mainly ten types of cheques in India that you should know about.

What is the Significance of an Account Payee Cheque?

Any third party can visit the bank to submit the cheque. No, only the account holders receive cheque book which they can use to transfer money or make payments. However, you can encash a cheque drawn in your name even without a bank account. A cheque is a paper instrument that orders the bank to transfer money from the sender’s account to another account. It is issued to a current or savings account holder to conveniently transfer money within and outside the bank. A cheque is a common method of money transfer among merchants and small businesses.

A Banker's cheque, also known as a cashier's cheque, is a type of cheque that is guaranteed by the issuing bank. It is considered as good as cash and can be used for large transactions or when the payee requires a guaranteed form of payment. The bank issues the cheque and deducts the amount from the account of the person who requested it. Because the bank guarantees the funds, the cheque is considered to be very secure and is often used for transactions such as real estate purchases or car sales. Banker's cheques are considered to be safer than personal cheques and are less susceptible to fraud.

In case of a crossed cheque, the drawer must draw two lines at the left top corner of the cheque. No kind of identification is required for the bearer of the cheque. Self chequeA self cheque is drawn in the name of the account holder. Open chequeAn open cheque is a cheque that is not crossed and can be cashed at any bank, not just the issuing bank. • If the date is missing on the cheque leaf, including mandatory details such as the beneficiaries name, issuer’s sign and more, a cheque may be rejected.

The cheque which has on it the future date or the later date is called a post-dated cheque. A cheque dated for a future occasion will not be processed before the specified date mentioned on the cheque. The main reason why practice of writing an account payee cheque is popular is that it is the safest form of a cheque. An Account Payee Cheque is a highly secured type of cheque as the amount can only be deposited in the account of payee. To understand the concept better, one must understand the difference between a drawer, drawee and payee.