A cheque is a negotiable promissory note and is a bank document that orders a payment of specified amount of money from a bank account. As a cheque is related to transfer of money, it needs to be written very carefully and cautiously. There are few very common mistakes committed by people while writing cheques that result in bank returning their cheques without honouring them. The list of most frequent mistakes is given below:
Forget to Sign
Now this seems little hilarious, but the truth is many people forget to sign their cheque. A cheque is not valid until and unless it is signed by the drawer (the one who has to make the payment and writes the cheque). An unsigned cheque, if deposited, then you will have to face an outright rejection of your cheque.
Before a cheque is cleared for payment, it is thoroughly checked by the banking authorities. If there is a noticeable difference in your signature on the cheque and the sample with the bank’s records, then your cheque will be dishonored for sure. In case, you doubt that your signature will not match, then you can even sign twice. However, it is a known fact the style of signing changes with age or sometimes a temporary difference may also take place due to illness or may be due to impact of any drug. If you find the difference because of age, then it will be better to keep your signature update with the bank.
Signed by single party
It has often been seen that people opt their account to be operated only in a joint way, i.e. a cheque will be cleared only when it will be signed by all the joint account holders. Many a times, people skip to get the sign of all such account holders on a cheque and resultantly their cheque fails to get cleared and they have to bear the consequences thereof.
Difference in the written amount and numeric amount
It is mandatory to write the amount both ways. This aids the bank in ensuring the correctness of the mentioned amount. The most widespread error while writing the amount is related to zeros. For example, you were required to issue a cheque for Rs. 4,000 and by mistake you end up writing Rs. 40,000 and didn’t even notice it. You will be saved of paying extra because of writing ‘four thousand only’ in words. Moreover, many people are not good with their hand writing and the numeric values are often not clear. If there is a difference in the amount you have written in numeric and what you have mentioned in words, then don’t expect your cheque to be honoured.
Earlier banks use to accept the edited cheques provided they are signed at the place of modification. However, the current guidelines prohibit any sort of editing or overwriting on cheque. Use of different coloured inks and multiple handwritings on a single cheque tantamount to alterations in cheque. Correction fluid or eraser is not the choice for correcting your mistakes on cheques. In case you have made any mistake while writing a cheque, it is better to void it then and there and write a new one.
No date or wrong date
This is a very simple and common problem with most of the people. Either they fail to mention the date on the cheque or they put an incorrect date. An incorrect date usually stems when you write a post dated cheque or you inadvertently put a stale date. A cheque cannot be deposited and cleared until and unless its date of issuing as specified on the top right corner of the cheque occurs. In case, you have issued a post dated cheque to somebody, then it is your responsibility to tell that person not to deposit the cheque before that date. While writing a cheque, it should be remembered that a cheque remains valid for three months from the date of its issuing. Let us say that a cheque issued in 2014 has inadvertently being dated as 2013, this being a stale and an invalid date will trigger the bank to return your cheque without honouring it.
A cheque is a valuable instrument. Any error will not only create trouble for the payee but will also impact you in number of ways. Therefore, it is necessary to take every care in writing an impeccable cheque.