How to Write a Cheque- a Step by Step Guide to Follow

Cheques are financial instruments that allow users to conduct transactions in a secure manner. When these cheques are not properly written, they may be rejected or dishonoured by the bank. Any kind of default or overwriting issue in the cheque can make it difficult to process the cheque.

Thus, in order to handle a cheque properly, you must be familiar with all of its components, as well as the parties involved and how to write it.

Who are the Parties involved in Cheque Transactions?

There are three parties involved in cheque based transactions-

  • Drawer- A person who issues or writes the cheque
  • Drawee- It is a financial institution that connects drawer and payee
  • Payee- A person or an institution who will receive the amount written on the cheque

What are the Parts of a Cheque?

  • Bank’s information- The cheque carries the name of the bank and its address
  • IFSC- It is a unique 11-digit code, which is a combination of numerals and alphabets
  • Payee information- The payee’s name must be properly mentioned here
  • Date box- Fill in the date, month, and year in this box
  • Rupees- This is where the drawer must write the amount in words
  • Account Number- The account number must be written down in order to process a payment
  • Signature- The drawer must properly sign the cheque in the designated signature space. Nowadays, most bank cheques are printed with the drawer’s name, above which his/her signature is required
  • Amount to be transferred- There are cheques that clearly state the maximum amount to be drawn.
  • Cheque number- Each cheque has a unique cheque number as well as a MICR code
  • Amount-This is the box in which the drawer must write the amount to be transferred in numbers

Here’s how a cheque looks like-

How to Write a Cheque?

A cheque is basically written into two parts-

  1. Writing the cheque
  2. Recording the payment

Part 1- Write the Cheque

A cheque can get dishonoured or rejected by the bank if it is not written properly, therefore, it is critical to include all relevant information in the cheque. To write a cheque, follow these simple steps:

  • Write the date at the top right-hand corner of the cheque in the format of “DD/MM/YYYY“. You can also create a post-dated cheque if necessary
  • Following that, you must record the ‘Payee’s’ name. A payee can be either an individual or a business. Make certain that the name is written correctly
  • Now, write the amount in words in the space designated for ‘Rupees.’ Write the amount from the very left side of the space, and don’t forget to include the word ‘only’ after writing the full amount. This way, the cheque will be safe from tampering. For instance, if the total is 4004, write it as “four thousand and four only.”
  • After you have finished writing the amount in words, write the same amount in numerals in the box provided on the right side of the cheque. Write the amount in the format “4004/-“
  • Sign the cheque. Use the same signature which you have used for other banking formalities. Wrong/mismatched signatures result in the cancellation of the cheque or can be proven invalid

Part 2- Record the payment

It is recommended that all details of the drawn cheque be recorded because this helps determine how much money was paid to the payee and how many cheques were issued. This way you will never lose track of the details of the cheques that you have drawn. When entering the cheque details, keep the following points in mind:

  • Fill out your cheque register book with all of the details for each cheque
  • Write the cheque number, the date on which the cheque is written/issued and the amount
  • A brief summary of the payee

In case you don’t have a cheque register book, make use of a spreadsheet to record the information.

Things to Keep in Mind when Writing a Cheque

Now that you know how to write a cheque, there are a few things you should keep in mind when doing so. Here are a few:

  • Make sure there aren’t too many spaces between the words.
  • Always use the phrase “only” after you’ve written the number of words.
  • Do not overwrite anything.
  • Don’t sign over the MICR band.
  • Fill in the correct date in the format specified on the cheque.
  • Keep track of your cheques.
  • Never hand over the cheque with only a signature
  • Always add payee name, date, amount and other details to avoid any misuse of the cheque
  • Always write the mobile number, connection number, and other details on the backside of the cheque when making a bill payment
  • Maintain consistency in your signature; do not use different signatures for signing the same series of cheques
  • Check that all of your spellings are correct
  • Double-check your cheque before submitting it to the bank
  • If there is an error on the cheque, write “void” and begin writing a new cheque
  • Only use a blue or black ballpoint pen or a pen that does not leak ink. Do not use a colourful pen to write a cheque

FAQs
What is IFSC and can it be found on a cheque?
An IFSC is a one-of-a-kind 11-digit alphanumeric code that identifies a particular bank branch. An IFSC code is written on the cheque to identify the bank’s branch and to make the transaction process smooth and error-free.
What is a cheque number?
Every cheque leaf has a 6-digit cheque number written at the bottom left-hand side of the cheque.
How long does it take to clear a cheque?
The cheque clearing process typically takes 2-3 working days. Sometimes it depends upon the amount written on the cheque to get it cleared.
When can a bank stop the payment processing?
Below are many reasons for the bank to stop the payment processing-
  • Insufficient funds
  • Outdated cheque
  • Difference in Issuer’s signature
  • Overwritten cheques
  • Details missed in the cheque

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