Process of Payment of all Types of cheques

One must have a general knowledge of the payment of the cheque. An order of any customer to the bank which is a kind of document to give the payment to any person or institution from the cash balance of his account is called a cheque. If the presented cheque is acceptable and there is enough balance in the drawer's account, the bank should honor the cheque and give the payment to the payee.

The cheques  are classified into the following four types:

1. Bearer cheque
2. Order Cheque
3. Crossed cheque
4. Specially crossed cheque

There are some differences in the process of the payment of all these cheques. Let's discuss those differences here.

Payment of Bearer Cheque

A cheque which bears the word 'own' or the name of the person who gets the payment from the bank where he has his account and the word 'Bearer" is not cut, such cheque is called 'Bearer Cheque'. They should give the payment to such cheque as per the above-mentioned process. There must be the date, the amount in figure and words, the account number, and the signature of the account holder. But in the case of a bearer cheque, except where there is the order for payment to a particular person by cutting the word or 'Bearer' the official of the counter should pay the amount of the cheque to that person written in ti only after the person who brings the cheque sign at the backside of the cheque.

Payment of Order Cheque

The only specified person gets the order cheque. The specified person or the person ordered by him should present the cheque himself to get the payment because the payment is given to the ordered person, it is called an order cheque. The bank should know the identity of an ordered person to pay such a cheque. The payment of such cheque can be as follows:

• If the person with whom the cheque is drawn must present himself to the bank to get the payment. But it is necessary to identify the person and his signature.
• If the person on whom the cheque is drawn orders another person to make the payment, that bank pays the cheque only after verifying that person's signature.
• The person mentioned in the cheque can endorse at the backside of the cheque to give the payment of the cheque to the person or institution. The bank can give the payment stamping and verifying the signature of such authorized person of the institution or person endorsed.

Payment of General Crossed Cheque

A general cross cheque is a cheque in which 'and company' or its abbreviated form is written within the two parallel lines of the cheque or only two parallel lines are drawn and the words 'Not Negotiable' are written within those lines over the face of the cheque is called, generally crossed cheque. The payment of this type of cheque is made as follows:

• Payment of generally crossed cheques is to be made only to the banker.
• Payment of a crossed cheque bears the words 'only account' (account payee) should be made only after collecting the amount in the account of the person on whom the banker has drawn in the cheques.
• If only the word 'and company' is written in the cheque payment is to be made after collecting that cheque in own account or if the person does not have his own account payment may be received after endorsing in favor of another person who has the account in the bank.
• Except in 'A/C Payee only' payment of other crossed cheques should be made if the person receiving payment is other than whose name has appeared in cheque after collecting bank certifies that his endorsement signature is true.

Payment of Special Crossed Cheque

If the name of the banker is written over the face of the cheque whether the words 'Not Negotiable' are written or not such cheque is called a special crossed cheque. If the name of the bank is written in between two slopping or straight parallel lines on the front side of the cheque, such crossing is called the special crossing. It is not necessary to draw parallel lines in such a crossing. But the name of the bank should compulsorily be written. A bank pays such cheque as follows:

• Payment of special crossed cheque is not to be given to other than the banker on whom the cheque is crossed or its representatives or agent mentioned or specified.
• Payment of such cheque is made only on the presentation of the mentioned or specified bank, not every bank can produce a special cross cheque to the drawee bank for payment. In this way, the special crossed cheque provides payment more safely.