Cheques are slowly becoming a thing of the past, but you might still need one to pay a bill or send money for a birthday. Some businesses don’t accept cheque because it does come with a risk that it could bounce. If accepting a cheque from someone, make sure it is someone you trust as if it turns out to be fake, it could be difficult to get hold of the money.
Writing a cheque
Writing a cheque is fairly simple as long as you get the basic right. Make sure you do the following:
- Write the name of the payee
Enter the payee’s name as it appears on their bank account.
- Enter the date
Usually this will be the day of writing the cheque. Can you can post-date a cheque by putting a date in the future, so it won’t be cashed early.
- The amount payable in words
When you write the amount in words, you need to put the full amount followed by the word ‘ONLY’ to stop anyone changing the amount.
- The amount payable in numbers
- Your signature
Also:
- Draw a line through any blank spaces so it cannot be altered by someone
- Complete the details on the stub for your own records
- Make sure you have sufficient funds in your account prior to the cheque being deposited. The bank may charge a fee if the payment bounces.
How long does it take to process
When you write a cheque to make a payment, it usually takes three working days to leave your account after the cheque is deposited.
When you pay in a cheque, you’ll see the funds deposited after four working days but will take up to six days to fully clear. If you have used cheque imaging to pay in your cheque, the money will be available inside two working days.
What if there is a problem
If you think you’ve made a mistake, you can ask your bank to cancel the cheque. There is often a charge for this. Remember to keep the cheque stub that contains all the details and can be provided if required.
Be aware, it is a criminal offence to hand over a cheque knowing that it will bounce or with the intention of cancelling it.
Banks will usually reject cheques that are older than six months. To avoid any problems, ensure you pay in all cheques as soon as possible.
Avoid writing or accepting post-dated cheques as it increases the likelihood of the payment bouncing.
