cheque and its kinds

Cheque is a written order of a depositor upon a bank to pay or to order of a designated party or to bearer, a specified sum of money on demand.

KINDS OF CHEQUES

There are three types of cheques:

i. BEARER CHEQUE:

It is cashable at the counter. This cheque can also be collected through clearing.

ii. ORDER CHEQUE:

It is also cashable on the counter but its holder must satisfy the banker that he is the proper man to collect the payment of the cheque and he has to show his identity through an account holder of the bank. It can also be collected through clearing.

iii. CROSS CHEQUE:

It is not cashable on the counter. It can only be credited to the payee’s account. If there are two persons having accounts at the same bank, one of the account holder issues a cross-cheque in favor of the other account holder. Then the cheque will be credited to the account of the person to whom the cheque was issued and debited from the account of the person who has actually issued the