What is the purpose of adding a crossing to a cheque?

Adding a crossing to a cheque increases its security in that it cannot be cashed at a bank counter but must be paid into an account in exactly the same name as that which appears on the ‘payee’ line of the cheque (i.e. the person who has received the cheque, who is legally the “payee” and “holder” of the cheque).

What is meant by the term crossing of cheque who can cross a cheque What are the various types of crossings?

General Crossing – cheque bears across its face an addition of two parallel transverse lines. Special Crossing – cheque bears across its face an addition of the banker’s name. Restrictive Crossing – It directs the collecting banker that he needs to credit the amount of cheque only to the account of the payee.

How is a cheque crossed point out its two advantages?

Uncrossed bearer cheques can be encashed by anybody – the payee/holder/bearer. The bank cannot refuse payment and it is as good as a currency. The drawer is well assured that the payee only gets payment. The payee is fully secured on account of crossing since the cheque cannot be encashed by any other except himself.

When the is crossed with two parallel line or with account payee only this crossing is known as?

Cheque crossing
Cheque crossing is recognized in the Negotiable Instruments Act of 1881. Crossing a cheque means drawing two parallel transverse lines between the lines on the cheque with or without additional words such as “& CO.” or “Account Payee” or “Not Negotiable.”

When the cheque is crossed with two parallel lines is known as?

A cheque which is crossed by two parallel lines on the top left side is called crossed cheque. Such a cheque is not encashable immediately and has to be deposited into the payee’s account.

What do you understand by crossing?

Definition of crossing 1 : the act or action of crossing: such as. a : a traversing or traveling across. b : an opposing, blocking, or thwarting especially in an unfair or dishonest manner.

Can crossed Cheque be endorsed?

Crossed Cheque– A crossed cheque is the one the proceeds of which can only be deposited into the payee’s account. However, such cheques can be endorsed by the payee to a third party; the next person can further endorse it to someone else.

Which is the safest form of crossing in cheque?

Explanation: In Account payee crossing the amount will not be paid to anybody over the counter. It will be credited to the account of the payee only. Thus account payee crossing ensures safe transfer of funds.

Who is paying banker?

Paying banker is a banker, who actually pays a cheque to his customer or to the order. of his customer. For example, a customer draws a cheque on his banker.

When in between two angular parallel lines on the face of the cheque the name of any specific bank is mentioned then it is known as which crossing?

“Where a cheque bears across its face an addition of the words “and company” or any abbreviation thereof, between two parallel transverse lines, or of two parallel transverse lines simply, either with or without the words “not negotiable”, that addition shall be deemed a crossing, and the cheque shall be deemed to be …

What is double crossing cheque?

Double Crossing: Double crossing is when a bank to whom the cheque crossed specially, further submits the same to another bank, for the purpose of collection as its agent, in this situation the second crossing should indicate that it is serving as an agent of the prior banker, to whom the cheque was specially crossed.

What are the differences between account payee cheque and crossed cheque?

To write an account payee cheque, you have to cross two lines on the left corner of the cheque and write “A/C payee only” between the two lines. Remember, if you simply cross the cheque and do not mention the words “account payee”, it will become a crossed cheque and not an account payee cheque.

Why are there two parallel lines in the top corner of cheque?

By putting two parallel lines in the top corner of cheque you are ordering bank to credit the proceeds into the bank account of the benefitiary and not in any otherway. The two parallel lines on the corner of the cheque is drawn for an account payee, ie. Cheque can be encashed only to the payees account and non other means .

What is a general crossing on a cheque?

General crossing. A crossed cheque generally is a cheque that only bears two parallel transverse lines, optionally with the words ‘and company’ or ‘& Co.’ (or any abbreviation of them) on the face of the cheque, between the lines, usually at the top left corner or at any place in the approximate half (in width) of the cheque.

What does it mean to cross a check with two lines?

Key Takeaways. A crossed check is a check that is crossed with two parallel lines, either across the whole check or through the top left-hand corner of the check. Crossing a check provides specific instructions to a financial institution regarding how the funds can be handled.

How do you cross a cheque for a payee only?

Cross your cheque appropriately. For a payee only (non-transferable) cheque: Cross the cheque by drawing two parallel lines across the top left-hand corner of the cheque. Cancel “or bearer” on the cheque and add “Account Payee Only” (or “A/C Payee Only”).