How does a cheque work ?

[praful47]

Being on this forum , I have learned many things about bank accounts , credit cards and debit cards.
One thing that I don't have the knowledge is about the cheques facility.
How does a cheque work and in what cases we can use cheque.

Eg : if someone gives cheque of ICICI Bank to me then where should I go with that cheque in my bank or ICICI branch ?

How can a cheque be cleared faster ?


Also , this thread will help to solve the queries related to cheques .

 

[Raavan]

Yes. I always print cheque using chrysanth check writing software

Even let's say if you have to pay via cheque to another individual?

I know companies use printed cheques to pay, what about us individuals? Savings account to saving account transfer via cheque

 

[Raavan]

Correct me if I am wrong,
Physical cheque validation 6 months
CTS - 3 months

The thing is that it is not in your control on how the cheques will be cleared - via CTS or older physical verification method.
The validity of a cheque before April 2012 was six months. But from April 2012, the Reserve Bank of India curtailed the validity of a cheque to three months.

 

[Abhi21]

The thing is that it is not in your control on how the cheques will be cleared - via CTS or older physical verification method.
The validity of a cheque before April 2012 was six months. But from April 2012, the Reserve Bank of India curtailed the validity of a cheque to three months.

2012 se😒 me kitna outdated hu.. Lol..
Thanks

 

[praful47]

In sbi cheques it is written CTS 2010 what does that mean ?

 

[telescope]

Even let's say if you have to pay via cheque to another individual?

I know companies use printed cheques to pay, what about us individuals? Savings account to saving account transfer via cheque

That's what I said. I always print cheque using chrysanth cheque writing software, whenever I have to issue cheque to pay electricity bill or any other payment. I print cheque for both for payment to individuals (family members) and payment to companies such as electricity, insurance etc.

 

[Raavan]

That's what I said. I always print cheque using chrysanth cheque writing software, whenever I have to issue cheque to pay electricity bill or any other payment. I print cheque for both for payment to individuals (family members) and payment to companies such as electricity, insurance etc.

Has any bank ever opposed or rejected the cheque?
Like saying it is not valid or write by hand or anything?

 

[Trust Me]

Correct me if I am wrong,
Physical cheque validation 6 months
CTS - 3 months

All cheques have been CTS cheques (with printed validity of 3 months only) for many years now, -- non CTS cheques are not issued anymore.

 

[Trust Me]

Has any bank ever opposed or rejected the cheque?
Like saying it is not valid or write by hand or anything?

That would be weird indeed, may even be illegal. Banks cannot reject cheques because they are printed.

In the US even 'check'books themselves can be printed by third-party printers, with numerous beautiful designs available to choose from (I used to have beautiful wild landscapes printed on my 'checks'). Quite unheard of in India.
.

 

[Trust Me]

CTS validity, I don't know..

Please edit out the duplicate quote, -- the first one somehow includes what you wanted to write as part of my post, which is wrong. Thanks.

 

[Trust Me]

if you deposit other banks cheque in a SBI branch, sbi will take 5-6 working days to deposit the money.

When did that happen? Your SBI branch must be particularly tardy.

Here is my experience from just last week:

I deposited two cheques on the same bank, first one in HDFC and second one in SBI (both in non-home branches)

Received credit in my HDFC account in 3 days. SBI took only two days!
.

 

[Arnal07]

When did that happen? Your SBI branch must be particularly tardy.

Here is my experience from just last week:

I deposited two cheques on the same bank, first one in HDFC and second one in SBI (both in non-home branches)

Received credit in my HDFC account in 3 days. SBI took only two days!
.

Here in my hometown Sbi employees clear deposit cheques on the last day of a week.There is a dropbox for these cheques in each sbi branch in our location.
On the other hand, hdfc & icici send deposit cheques almost immediately for clearing.

 

[hender]

Here in my hometown Sbi employees clear deposit cheques on the last day of a week.There is a dropbox for these cheques in each sbi branch in our location.
On the other hand, hdfc & icici send deposit cheques almost immediately for clearing.

SBI -Weekly Collection only !

 

[Trust Me]

SBI -Weekly Collection only !

In which place?
.

 

[Arnal07]

SBI -Weekly Collection only !

Yes, they only clear deposit cheques once a week.

 

[telescope]

Has any bank ever opposed or rejected the cheque?
Like saying it is not valid or write by hand or anything?

No. Never. Why would they reject? It makes banks safer from future claim of fraud. At the same time it gives peace to mind to me that it won't be possible to alter the cheque.

 

[Trust Me]

In sbi cheques it is written CTS 2010 what does that mean ?

That means the Cheque Truncation System (CTS) was introduced in 2010.
.

 

[Trust Me]

It makes banks safer from future claim of fraud. At the same time it gives peace to mind to me that it won't be possible to alter the cheque.

Safety can be ensured easily enough in handwritten cheques too, -- just by putting an upside-down carbon paper below the cheque while writing. This will leave a mirror-image imprint of the original writing on the backside of the cheque. 🙂
.

 

[thanix]

In the early days, even when opening a bank account, cheque book will be issued only accounts of good standing after some time or with higher balance. This is by PSU banks to prevent misuse of cheque.

Essentially cheque is like a letter of credit used by businesses. There has been lot of cheque bounce cases in the system.

Banks will verify and may reject a high value cheque if there is unusual pattern or signature mismatch. We use to write our name and phone number even around a decade back so that our own bank can call and confirm if there is mismatch. Because if they pass and any fraud is detected, it will be loss to banks.

Now positive pay is implemented that you can update your bank through netbanking that it was you who have given an cheque. We all have moved to UPI and cheque transactions are done by businesses as usual.

 

[panchabhut]

We all have moved to UPI and cheque transactions are done by businesses as usual.

Businesses have mostly moved to NEFT/RTGS

 

[praful47]

Businesses have mostly moved to NEFT/RTGS

low scale business still rely on cheques