A crossed cheque is basically any cheque which is crossed with two parallel lines. The lines can be drawn either across the whole cheque or through the top left-hand corner. It simply means that the specific cheque can only be deposited straightway into a bank account and cannot be instantly cashed by a bank or any credit institution. This ensures a level of security to the payer since it requires the funds to be handled through a collecting bank.
Different ways to cross a cheque
Cross cheque focuses on the instruction given by the drawer (maker) of the particular cheque to the drawee bank. This instruction demands to pay the cheque at the counter of the bank, but with a strict direction to pay it to a person who offers it through a banker. Crossing makes it possible to trace the person to whom the amount/payment has been made. In India, there are various crossing tools to safeguard cheque payments such as:
This type of cheque crossing requires two parallel transverse lines. There isn’t any restriction to put these parallel lines on a specific area on the cheque, but they can be drawn anywhere. Usually, it is advisable to put it on top left corner of the cheque. The usefulness or significance of this crossing is that the cheque should essentially be paid only to the banker.
Special Crossing cheque does require the name of the banker. The effect of this type of crossing is that the cheque should be funded only to the banker to whom it is crossed. It is a reminder to all the people that a special crossing cannot be changed into the general crossing.
Account Payee Crossing
Account payee crossing is also called as restrictive crossing. This type of cheque needs to comprise the words ‘account payee’ or ‘account payee only’. Further, the cheque must be crossed either generally or specially. The significance of this type of crossing highlights that the cheque isn’t negotiable anymore.
Not Negotiable Crossing
In this type of cheque crossing variety, the paper document needs to contain the words ‘not negotiable’. Moreover, the cheque can be crossed specially or generally.
Uncrossing a Cheque
- If you are now familiar with the cross cheque meaning, then clearly there is no way the payee can uncross the cheque. Furthermore, the cheque is considered non-transferable, which means it cannot be transported to a third party. However, the only action which is allowed is for the payee to deposit the cheque in an account which he/she holds with their own name.
- Therefore, the payer can uncross the cheque by lettering “Crossing Canceled” across the front side of the cheque. However, such an action isn’t recommended since it eliminates the protection the payer initially had in place.
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