- Cheque is a payment instrument that is issued by a back account holder for making payment to an individual or company and cash withdrawals from the bank.
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| Cheque |
Types:
Open Cheque:
- A cheque is called open when it is possible to get cash over the counter at the bank.
Bearer Cheque:
- A cheque which is payable to any person who presents it for payment at the bank counter is called bearer cheque.
- A bearer cheque can be transferred by mere delivery and requires no endorsement.
- The cheque is negotiable from the date of issue up to 3 months.
Order Cheque:
- It is the one which is payable to a particular person.
- In such a cheque the word "bearer" may be cut out or cancelled and the word "order" may be written.
- The payee can transfer an order cheque to someone else by signing his or her name on the bank of it.
Crossed Cheque:
- When a cheque is crossed, the holder can not encash it at the counter of the bank.
- The payment of such cheque is only credited to the bank account of the payee.
- Crossed cheque is done by drawing two parallel line across top left corner of the cheque, with or without writing "Account payee" in the space between the lines.
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