What is Cheque? Understand 10 Different Types of Cheques

• Similarly, the amount mentioned on the cheque cannot be altered.

Challenges in detecting fake cheques

Usually, the banks take 1-2 business days to process and clear the cheque payment. The time may increase depending on the day of the week since it is a manual clearing process. For specific reasons, the bank may also ask you to enter your account name and number at the back of the cheque leaf. • Mobile app – Like net banking, you can also use your mobile banking app to apply for a new chequebook. The process is similar to net banking and consumes hardly a couple of minutes.

However, this should be done with caution as the issuing bank may charge additional fees for issuing a new cheque. This is the individual whose name appears on the cheque and who receives payment in the amount specified therein. The drawer and payee may, in some circumstances (such types of cheque in india as when the drawer makes a self-cheque), be the same person. • 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. Yes, a cheque can be used instead of cash payment if the merchant or the shop accepts cheque payments.

First Step Towards a Successful Banking Career

In this article, we will learn about the “Type of cheques in the banking system in India”. To put it in simple words, a cheque is nothing but a written bill of exchange that is written by a bank account holder to pay for goods or services. It is always issued in favor of other parties, there may also be third parties and it is an order for the bank to pay the person whose name the cheque bears or is in favor of. In generally crossed cheque, two parallel lines are drawn on the cheque, either on the sides or across the entire cheque. This means that the money can be deposited only into the payee’s bank account.

It is also considered the safest form of crossing and is widely used in the market. In general crossing cheques, there is the presence of two parallel lines present on the top corner of the document. Bearer cheques are the most common types of cheques seen around the globe. In such cheques, the bearer of the cheque is allowed to encash the cheque at banks or other financial institutions. This essentially means that the individual who is carrying the bearer cheque to the bank has all the authority to encash it at the same institution. 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.

Banker’s Cheques

• Cheques are issued only to account holders, so anyone who wishes to use cheques first must open a bank account. It is used by the issuer to withdraw money from their bank account. A stale cheque has already passed its validity date and can no longer be cashed. Currently, a cheque is considered valid until three months from its issued date.

How much time does the bank take to clear a cheque?

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. A special crossed cheque has the name of a specific bank between the two parallel lines.

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. An open cheque does not have any crossing marks on its face and is generally issued to the bearer. The bearer holds the authority to redeem the cheque or simply cash it. Therefore, it is not a safe means of making a transaction, when compared to a crossed cheque.

1. Yes, a cheque can be used instead of cash payment if the merchant or the shop accepts cheque payments.
2. The post-dated cheque can be valid after the mentioned date but not before it.
3. • ATM – If you don’t have an active net banking or mobile banking service, you can visit your nearby ATM and access your account using the debit card and pin.
4. Individuals who do not hold a bank account can easily use an open cheque to receive money.
5. A crossed cheque can only be deposited into the payee’s account.

It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision. The drawer or the cheque holder has the authority to sign the cheque. An individual impersonating the cheque owner’s sign is considered an offender under the law.

It becomes useful when you are heading on a foreign trip and do not wish to carry too much cash. Like regular cheques, crossed cheques also have an expiration date. Make sure to deposit them before the date mentioned to avoid any inconvenience.

1. A cheque which has all the fields blank except for the drawer’s signature, then it is called a blank cheque.
2. A comprehensive yet modular suite of services is doing precisely that.
3. • Signed cheques without any amounts mentioned in them are known as blank cheques.
4. Utilize this secure payment instrument to safeguard your financial interests and keep your transactions hassle-free.
5. Bearer cheques are the most common types of cheques seen around the globe.
6. To put it in simple words, a cheque is nothing but a written bill of exchange that is written by a bank account holder to pay for goods or services.

A cheque can be drawn on either a current or a savings account. A cheque number, MICR code, and IFSC code are printed on every bank check. The on-track motion of money through a written paper source is facilitated by the cheque method of fund payment, which involves three parties. There are various types of cheques, including bearer cheques, order cheques, crossed cheques, account payee cheques, post-dated cheques, ante-dated cheques, traveler’s cheques, and more. Each type of cheque has its own specific characteristics and purposes.