There are many ways in which you can transfer your money. These include Online transfer, Cash payment, Cheque payment, Demand draft etc. In the case of making a payment, many people opt for a payment through a cheque. There are different types of cheque like bearer cheque, Crossed Cheque, self-withdrawal cheque, account payee cheque etc. Many people don’t know the difference and implications of each cheque. Hence, they make a lot of mistakes that end up in cancellation of the transaction.
A cheque is a written order that is submitted to the bank which summons the bank to pay the given amount from the drawer’s account. There are 3 basic entities in a cheque transaction, those are:
  • Drawer: The individual who signs the cheque and from whom’s account the money is to be paid is called a drawer.
  • Payee: The individual who will get the amount by this cheque is called the payee.
  • Drawee: The intermediate between the drawer and the payee is the bank and it is called the drawee.
Let’s get into the details of each type of cheque and its significance


Crossed Cheque

crossed cheque

A crossed cheque is a cheque that has 2 slanted parallel lines at the upper left corner of the cheque. This implies that the payee isn’t authorized to get the amount directly in the bank or any other institution. Instead, the payee has to credit the amount mentioned in the cheque directly in his bank account.

This is for added security and everyone must take advantage of it. When there are no slanted or cross lines on the cheque, it is called an open cheque. There are no compulsions on an open cheque and it can be encashed directly at the bank counter.

Also, there is one more advantage of a crossed cheque. The payee whom the cheque is addressed to has the option of either crediting the amount to his own account or else forwarding this cheque to another person. The payee just needs to write the name of the person whom he wants to forward this cheque with his signature on the back side of the cheque. Therefore, this saves a lot of time and process when the middleman has to make payments. There are no restrictions on who can endorse/forward this type of cheque.
The difference between a crossed cheque and a bearer cheque is that a bearer check can be encashed by the payee whereas the crossed cheque cannot.

The Types Of Crossed Cheques

Crossed cheques have 2 types that have a different set of instructions to the bank. These types are as follows:

1] General crossed cheque

General crossed cheque

A generally crossed cheque is where the drawer simply adds 2 slanted lines at the upper left corner of the cheque without any instructions written on it. The amount written in these types of cheques can be credited to the payee’s account only and cannot be encashed as stated earlier.

2] Special crossed cheque

Special crossed cheque

A crossed cheque is a cheque where the drawer writes in a set of instructions in between the slanted lines. For example, the drawer can put “A/C payee only” or “HDFC bank” that will instruct the bank to credit the amount to the payee only or only the HDFC bank can credit this amount to the payee. It is not compulsory to do so, but it can be helpful in special cases.

3] Account payee cheques

This is another type of crossed cheque that increases the security level on the cheque. You need to write “A/C payee only” in between the slanted lines for this kind of cheque. This means that the payee has to credit the amount to his account only and that he cannot forward it to another person.

Therefore, it cannot be misused and, hence, you should make most of it. A banker can collect this type of cheque from a person other than the payee. This cheque has a validity of 3 months.

Self-withdrawal Cheque

When you need to withdraw money from your own account, you can write a self-cheque. To write such a cheque, you need to fill in all the details normally and just write your full name in the slot of “Pay to the Order of”. You can also write “SELF” on the cheque for the bank to understand.

So make sure you use all the security measure provided to you by the bank during the cheque transactions. For any queries or suggestions, please leave a comment below.

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