Many checks today are done online as most banking transactions are in today’s digital world, enabling the secure, safe, and quick movement of money anywhere and anytime. Cheques are still a very popular means of payment, especially for paying large amounts or formal transactions.
While it is very convenient, many people make huge mistakes while signing cheques and this leads to impeding things like bank cheque bounce, a fraud case, or even legal trouble.
If you regularly deal with gifts, it is very important to learn how to fill blank cheques properly since the slightest error may cost you dear, causing major problems like the loss of money or scrutiny in society.
This are the common cheque errors and how to avoid them.
Not Writing “Only” After the Amount in Words
Not writing “Only” after the amount in words is one of the most common mistakes. For example, if you are writing a cheque for ₹5,00,000, always write it as “Five Lakh Only”. In the same way, a slanting bar (/) should be added to the numerical amount (₹5,00,000) to prevent tampering, thus ensuring that no one else can tamper with the amount and withdraw more money from your account.
Signing a Blank Cheque
Never sign a blank cheque, regardless of whether you trust the person with it or not. A blank cheque is just an open invitation to commit fraud. Write in who the payee is for, how much, and the date before you sign. This simple precaution can prevent you from a storm in your finances.
Mismatched Signatures
An incorrect signature is one of the prime causes of a cheque bouncing. Banks check the signatures on the cheque with that on file, and if they do not match it, the cheque will not be honored. To avoid this, always sign the cheque in the same way as you did on the signature form in the bank.
Wrong Date on the Cheque
The date on the cheques must be compulsorily accurate according to the banks. If this is incorrect, incomplete, or unrealistic (like a future date when not meant), then the cheque would not go through. Sometimes checking the date doesn’t do any harm, just making sure it is just right and in line with what you want to do.
Not Using Permanent Ink
When filling out a cheque, always ensure you use a pen with permanent ink. The use of faint or erasable ink would allow tampering with the cheque as the written input can always be altered without being detected. Permanent ink would therefore prevent alteration of details written on the cheque, thus shielding against fraud.
Issuing Cheques When Insufficient Balance Is Left in the Account
Among the heaviest mistakes, issuing a cheque while not having sufficient funds in your account ranks among the top. If the cheque bounces due to insufficient balance, hefty fines might be imposed on you, or even legal action might take effect, and in worst cases, a possibility of being jailed might loom. Always check your account before writing any cheque to ensure there are enough funds available.
Why Avoiding These Mistakes Matters
Post-date Cheques Wrongly Postdating a cheque (writing a future date) can have a lot of problems if it is not done properly. For example, banks usually dismiss checks having future dates, or especially, if the date is vague or unreasonable. In case you must post-date a cheque, use a date that is appropriate for your future financial plans.