Types of Cheques & How to Apply for a New Cheque Book?

A Cheque is a financial instrument that instructs a bank to transfer a certain amount of money from one person’s account to the account of another individual or corporation in whose name the cheque was written or issued. The Cheque is a payment method that is safe, secure, and fast.

It is a safe solution because no physical currency is involved in the transfer procedure, reducing the risk of loss or theft. A cheque can be written against a current or savings account. Every bank Cheque is labeled with a cheque number, MICR, and IFSC code. The Cheque form of fund payment involves three parties in the on-track flow of money via a written paper source.

What is a Cheque and the Different Types of Cheques | How to Write Cheques

Parties to Cheque

Drawer – The individual who signs the Cheque and orders the bank to pay the specified amount.

Drawee – The bank on which the cheque is drawn or who is ordered to pay the amount mentioned on the cheque.

Payee – The beneficiary, or the person to whom the money will be given.

Main features of Cheque

  • A cheque is an irrevocable order.
  • It is usually drawn on a certain bank.
  • A mandate should only be signed on the exchequer by the creator.
  • The amount is always a certain amount of money from one’s account.
  • On-demand, a cheque is always payable.
  • The payment for a cheque is always in cash.
  • The monetary sum is to be paid to the individual named in the letter, order, or bearer.

Types of Cheque

1. Bearer Cheque

This form of the cheque can be cashed by the bearer (the person carrying/bearing the cheque) when presented to an authorized bank. Banks do not need authorization from the issuer to make payments on these cheques.

2. Order Cheque

This form of the cheque may only be cashed by the payee or the person whose name appears on the cheque.

3. Open Cheque

This is an uncrossed cheque that can be cashed at any bank and paid to the individual carrying the cheque. It can also be moved from the original payee to a different payee. Both the front and reverse of the cheque must be signed by the issuer.

4. Crossed Cheque

The account payee cheque is another name for it. The words “account payee” are printed in two parallel lines on the top left corner of the cheque. These lines ensure that payments are paid exclusively to the person whose name is printed on the cheque, making them the safest sort of cheque to issue.

5. Post-Dated Cheque

This sort of cheque can be cashed at a later date and utilized to pay a future financial obligation. Even if the bearer immediately presents them to the bank, the payment is executed by the bank only on the date specified on the cheque. These cheques are good for three months from the date of issuance.

6. Banker’s Cheque

The bank issues a banker’s cheque, which guarantees payment.

7. Self Cheque

A self-cheque has the word “self” printed in the drawee column and can only be cashed at the bank of the issuer.

8. Traveler’s Cheque

Foreigners on vacation can use this form of a cheque instead of actual currency. These are issued by one bank and can be cashed in the form of currency by a different bank in a different location/country. Traveler’s cheques do not have an expiry date and can be used at any time.

Advantages of a Cheque

  • It is more secure and handy to carry than cash.
  • It is a negotiable document that can be endorsed in the name of a third party.
  • If it is misplaced, it may be readily found.

Disadvantages of a Cheque

  • Payments via cheque are occasionally declined because they are not legal tender.
  • Cheques cannot be used by those who do not have a bank account.
  • Depositing a cheque into your bank account necessitates a trip to the bank, which takes time.

Positive Pay System

The positive pay method was used to combat fraud caused by tampering and to promote consumer safety in cheque payments.

The procedure entails reconfirming the data of big-value cheques, that is, cheques worth more than Rs. 50,000. If the facts match, the cheque is honored; otherwise, the disparity is noted.


MICR, or Magnetic Ink Character Recognition, is a nine-digit code that is often written at the bottom of a cheque leaf. The first three numbers identify the city, the next three represent the bank, and the final three reflect the specific branch code. The MICR code on a cheque aids in the identification of the cheque, the elimination of payment mistakes, and the processing of cheque payments.

How to Apply for a New Cheque Book?

You can apply for a new cheque book in a variety of ways, including the methods listed below

1. Internet Banking

Log in to your bank’s online banking account and request a cheque book by providing information such as your account number and postal address. The cheque book is then sent to the address associated with your bank account.

2. Mobile Application

Simply access your bank’s mobile app and request a cheque book.

3. ATM

  • You may also obtain a cheque book from an ATM by simply following the steps outlined below
  • Insert your debit card into an ATM at your bank.
  • Enter your PIN and choose ‘issue new cheque book.
  • Click the ‘Submit’ button.
  • After you submit your request, your cheque book will be mailed to you.

4. Branch Visit

You can also go to your bank and request a fresh cheque book.

How to Write a Cheque? Things to keep in mind when writing a Cheque

Remove the words ‘OR BEARER’ and replace them with ‘A/C Payee’ in the upper left corner of the cheque. This assures that no one other than the person in whose favor the cheque is issued may obtain the specified amount.

Avoid leaving gaps between the words PAY and the Receiver’s Name, as well as between the name and surname. This method is vital since it does not allow anyone to claim the money by filling in the alphabet before or after the name.

After noting the number of words in the ‘RUPEES’ column, always put ‘ONLY’ with the symbol ‘/-‘ at the end. Make sure there is no overwriting. It indicates that the banks will not accept any scribbling or text cancellation.

Enter the right date. A cheque without a date allows anyone to write any date on it and withdraw cash at their leisure using the bank cheque. A cheque with a post- or pre-date is another problem that might lead to the cheque being dishonored. Furthermore, a miswritten date, such as the wrong year or month, will cause you problems.

Make certain that you do not pass over a cheque that does not include the date, the amount of the cheque in figures and words, and the Payee’s name.

Keep your signature clear and, if necessary, sign again to guarantee that the cheque does not bounce owing to a mismatch in signatures. When paying utility bills, including the credit card number, cellphone number, connection number, and so on on the back side of the cheque.

It is expressly forbidden to staple, disfigure, or fold a cheque, or to harm the MICR Band in any way. Various banks in India have issued particular instructions for properly writing out cheques. It is critical to read your bank’s instructions to have correct awareness. Furthermore, look out for the circumstances for cheque bounce; this will make you more vigilant during the cheque-filling procedure.

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