If you have a savings bank account or current account in a bank, you can issue a cheque in your own name or in favor of others, thereby directing the bank to pay the specified amount to the person named in the cheque. Ideally, this cheque has or bearer printed at the end of the dotted lines, which is meant to have the name of the drawee. Crossed cheque is not payable over the counter but shall be collected only through a banker. It is payable only via the banker mentioned and cannot be cashed at the bank counter. Crossing of a cheque means drawing two parallel lines across the face of the cheque. A general crossing can be converted into a special crossing.
When two parallel transverse lines, with or without any word, are drawn generally, on the left hand top corner of the cheque. Thus, crossing is necessary in order to have safety. A crossing authorised by this act is a material part of the cheque. Types of crossing of cheques banking awareness oliveboard. Negotiable instruments the law relating to cheques. Jun 24, 2018 types of cheques and its important terms.
Crossing of a cheque means two parallel traverse lines on the face of the cheque with or without words. Types of cheques and its important terms banking awareness. The crossing of cheque had developed gradually as a means of protection against misusing of cheques. Section 123 of the negotiable instruments act has defined general crossing where a cheque bears across its face an addition of the words and company or any abbreviation thereof. What is cheque types of cheque parties involved in cheque. Cheques types and crossing of cheques bankexamstoday. General crossing this is the most general type of crossing where the drawer simply puts two parallel lines at the upper left corner of the cheque. The crossing of a cheque is done by making two transverse parallel lines at the top left corner across the face of the cheque. Jul 19, 2019 such cheque can be processed for payment till it becomes stale i. Different types of cheques based on methods of issuing. A crossed cheque generally is a cheque that only bears two.
Nepal rastra bank nrb cheque standards and specifications page 6 of 42 3. Crossing of cheque different types of check crossing. What is effect of different types of crossing on cheques in. Cheque is a negotiable instrument used to make payment in day to day business transaction minimizing the risk and possibility of loss. Dec 30, 2017 in this video i am explaining cheques and it types in detail.
In these types of cheque the word bearer after the pays name is crossed out and the word order is written instead. This type of situation may result in wrong use of the cheque. Crossing of cheque crossing of cheque and its different. Oct 18, 2015 effect payment will be credited to the account of payee named in the cheque. There are various types of cheques and various ways of issuing a cheque. Cheque types pdf download short note for ibps, bba, mba, llb. This cheque is payable to the bearer of the check or whose name the cheque carries in the column meant for the name of the drawee. Crossing of the cheque is done to issue special instructions to the bank regarding the cheque. A person issue the cheque to make the payment to an intended person but cheque may be lost or stolen in between going into wrong hands. General, special and restrictive is 3 types of cheque crossing. Crossing of checks ensures security to the holder of the check, because only the collecting banker credits the proceeds to the account of the. A crossed cheque cannot be encashed at the cash counter of a bank but it can only be credited to the payees account. Jul 14, 2018 general and special crossings are defined in sections 123 and 124 of the ni act, 1881 respectively.
Cheques types and crossing of cheques published on sunday, october 18, 2015. Effect payment will be credited to the account of payee named in the cheque. Crossing of cheques are defined in section 123 of negotiable instrument act, 1881. A cross cheque is an instruction under the negotiable instruments act to the banker that the amount specified in the cheque should be deposited directly unto. Effect of crossing a cheque the crossing on a cheque is a direction to the paying bank that the cheque should be paid only to another bank. This ensures that payment is made to the actual payee. There are two types of crossing of cheques general and special crossing of cheques. This is because payment of a cheque in contravention of a crossing would be regarded as negligence by the bank. The crossing of a cheque ensures security and protection to the holder.
What is effect of different types of crossing on cheques. The significance of crossing of a cheque is that a crossed cheque cannot be encashed by the bearer but can only be collected from the drawee bank in the bank account. If any cheque contains such an instruction, it is called a crossed cheque. Introduction to cheque and its types lets learn nepal.
How to fill state bank of india sbi demand draft dd banker cheque slipform correctly. Such cheque can be processed for payment till it becomes stale i. Crossing of cheque provides instruction to the paying banker to pay the amount through banker only, and not directly to the payee or holder presenting it at the counter. There are two types of cheques crossed cheque and uncrossedopen cheque crossed cheque. Types of cheque there are two types of cheques crossed cheque and uncrossedopen cheque. Feb 09, 2018 a cheque is an unconditional order addressed to a banker, signed by the depositor, requesting him to pay on demand a certain sum of money only to the order of the certain person or to the bearer. Dec 04, 2017 meaning of cheque different types of cheque.
A cheque crossed is one which carries the explicit instruction about the method in which it is to be redeemed. In this video i am explaining cheques and it types in detail. Nov 26, 2009 crossing can be done by drawer, banker or holder. It is made when the banker in whose favour the cheque is crossed does not have branch where the cheque is paid. A crossed cheque is a cheque that is payable only through a collecting banker and not directly at the counter of the bank. Definition of a cheque v cheque is an instrument in writing containing an unconditional order, addressed to a banker, sign by the person who has deposited money with the banker, requiring him to pay on demand a certain sum of money only to or to the order of certain person or to the bearer of instrument. A pdc is a form of a crossed or account payee bearer cheque but post dated to meet the said financial obligation at a future date. In this second bank act as agent of the first collecting banker. The person named in a cheque types of cheque there are two types of cheques crossed cheque and uncrossedopen cheque crossed cheque. Purpose of crossing a cheque the object behind crossing a cheque is to affirm the security of the chequeholder. So to add some security to restrict the way it can be redeemed, drawer marks some types of crossing on the.
If you dont provide any crossing on the cheque, then it will be a bearer cheque. Different types of crossing on cheque in banking and its effect. Section 6 of the negotiable instrument act defines a cheque as, a bill of exchange drawn on a specified banker and not expressed to be payable otherwise than on demand. It very important for banking awareness that comes in various competitive exams like bank po ssc etc. Dec 09, 2017 different types of crossing on cheque in banking and its effect. Crossing of checks is a method by which a check is made payable to the holder only through a collecting banker and not directly at the counter of the bank. General crossing cheque bears across its face an addition of two parallel transverse lines. The issuer of the cheque would just fill the name of the person to whom the cheque is issued, writes the amount and attaches his signature and nothing else. It includes the electronic image of a truncated cheque and a cheque in the electronic form. A cheque is a bill of exchange drawn on a specified banker and not expressed to be payable otherwise than on demand.
Therefore, it is imperative to have a standard layout which contains fields or areas that are legally required or. The first among the types of cheques is the bearer cheque. Types of cheques check various types of cheques detailed info. Definition, features and its types cheque is a very common form of negotiable instrument. It very important for banking awareness that comes in various competitive exams like bank po ssc etc share, support, subscribe. A cheque having a date of 1 st june 2019 is considered an antedated cheque. Types of cheque cheque types pdf download short note for ibps, bba, mba, llb. Many of us dont know the about the various types of crossing of cheque as per negotiable instrument act, 1881.
Types of crossings under section 76 1 of the ordinance, there are. There are 2 types of crossing which can instruct the bank to act accordingly with the amount of the cheque. The person writing the cheque, known as the drawer, has a transaction banking account often called a current, cheque, chequing or. The cheque must bear a date otherwise it is invalid and shall not be honored by the bank. What is a cheque definition, types of cheques and features. Purpose of crossing a cheque the object behind crossing a cheque is to affirm the security of the cheque holder. As a common man, we often prepare cheque and mark it as account payee. A bank can ignore the crossing and pay a crossed cheque over the counter. How to fill joint account opening form of sbi saving bank. This practice is nowadays not accepted by the banks. There will be several conditions for an ordered cheque as described below. Cheque layout a cheque is a document which shall be easily readable by the human eye or by a machine regardless of the manner in which it is completed. This is also referred to as general crossing a crossed cheque cannot be cashed at the drawee banks cash counter. The particular types of currentcheque accounts, fixed deposits and savings accounts we offer are set.
Tannan, by crossing a cheque generally, the banker is directed not to make payment except through another banker and thus a pers. Mar 01, 2017 1 general crossing when a cheque bears two transverse parallel lines at the left hand of its top corner. What are the different types of cheques read and digest. Types of cheque pdf download banking awareness gk babaji. A cheque is an unconditional order addressed to a banker, signed by the depositor, requesting him to pay on demand a certain sum of money only to the order of the certain person or to the bearer. You must keep cheque books secure including keeping them in a safe place please refer to the security procedures set out in the client terms. Types of crossings under section 76 1 of the ordinance, there are several types of recognized crossings as follows. General and special crossings are defined in sections 123 and 124 of the ni act, 1881 respectively. A crossed check is any check that is crossed with two parallel lines, either across the whole check or through the top lefthand corner of the check. The purpose of crossing the cheque is that one cannot collect cash from the counter of the bank. Various types of cheques based on their functionality. If you take it to the bank counter, you will be able to encash the cheque, without any issue. It is used by individuals, businesses, corporate and others to transact for making and receiving payment. Money can only be deposited into the payees account only.
Crossing of checks law and legal definition uslegal, inc. If you provide a crossing on the cheque, it will be a ordered cheque. A local cheque is a type of cheque which is valid in the given city and a given branch in which the issuer has an account and to which it is connected. The person writing the cheque, known as the drawer, has a transaction banking account often called a current, cheque, chequing or checking account where their money is held. How to fill state bank of india account opening form 2018. Currentchequesavings account and fixed deposit terms. May 14, 2016 in these types of cheque the word bearer after the pays name is crossed out and the word order is written instead. Ideally, this cheque has or bearer printed at the end of the dotted lines, which is. Crossing is a popular device for protecting the drawer and payee of a cheque.807 1362 1185 123 1055 1190 477 308 203 334 853 873 65 250 964 1019 473 125 428 1054 1070 482 817 115 108 337 602 877 265