What is a check – a check is a means of payment given by the bank to an account holder, by which the customer can pay to the next person by not giving direct cash from his account.
What is a check – A check is a means of payment given by a bank to an account holder, by which the customer can pay the next person by not giving direct cash from his account. Whose money you are paying in check, their name has to be written which can also be the name of a person or of a firm. You also have to fill in the check how much money you are paying (in words and numbers) to that person, when you are giving it and finally you have to sign it. The person takes your check and puts it in his account and the amount you gave him is transferred to his account.
In a nutshell, a check is a cashless payment, such as an electronic transfer.
Classification of checks: by location
- Local Check –If a city check is cleared in the same city, it is called a local check. Just like if I gave you a check in your name, then you will have to go to the respective branch of the city with that check, if you take it out of the city and clear it, then you will incur separate money.
- Outstation Check –If a local check is taken out of the city and cleared, the check will be called an outstation check for which the bank charges a fixed charge.
- At Par Check – This is a check which is acceptable at all the branches of the concerned bank across the country. And the special thing is that there is no extra charge when clearing it in outside branches.
Classification of checks: On the basis of price –
- Simple denomination checks
Checks worth less than 1 lakh are called normal value checks.
- High value checks
Checks above 1 lakh are called high value checks.
- Gift check
Checks that are gifted to loved ones are called gift checks. Gift checks amount to Rs 100. 10,000 to Rs. can happen till.
There are mainly three types of checks –
- Open check –
An open check is a check that can be presented at the bank and cash can be obtained at the counter. You do not need to wait for clearance. Give and Take. The person holding the open check can go to the counter, show the check, take the money and either transfer the money to their account or authorize another person by signing the back of the check. is.
- Bearer check –Bearer check is a check which any representative of the account holder can redeem by going to the bank. While giving the check to the representative, there is no need to sign the back of the check and withdrawal is done only by giving the check. This check can also be risky because if this check is forgotten, any bank can go and redeem it.
- Crossed Check –
Crossed checks are written in the name of a particular individual or institution and two parallel lines are drawn on the top left between them. Shaham & COÐ or Account Payee or Not Negotiable can be written or not. This check does not withdraw cash and the related amount can only be in the account of the nominee / institution.
- Order Check–
In this check the word order is truncated and instead of this the word shahmsradgham is written. In this, like an open check, one can transfer money to his account by check or can authorize another person by signing the back of the check.
Classification of Check: Based on Guaranteed Payment –
- Self check – Aself check is one which the account holder presents himself for direct payment to the bank. In this, the name of the payee is written instead.
- Forward Check – PDC The check paid at the
forward date is a crossed bearer check in which the forward date is marked. This means that this check can be paid on or after the marked date.
- Back-dated check – ADC
This check is the date before it was presented to the bank. This check can be redeemed till the completion of three months from the last date.
- Time interrupted check –There is a rule for cashing every check within three months of the date mentioned in it. If this date is exceeded, it is called a call barred check which is not accepted by the bank.