A cheque in circulation for more than six months is called

Question

Question

This question was previously asked in

TNUSRB SI 2010 Official Paper (Held on 04 July 2010)

Answer 1

Correct Answer Stale cheque

Key PointsStale Cheque:

A stale cheque is a cheque that remains unencashed or undeposited for a specific period, typically three to six months, from the date mentioned on the cheque.
After the expiry of this period, the cheque becomes invalid and cannot be honored by the bank.

Bearer Cheque:

A bearer cheque is payable to the person who possesses it.
It can be encashed over the counter by the holder or deposited into their bank account.
Bearer cheques are considered riskier because they can be misused if lost or stolen.

Order Cheque:

An order cheque is payable to a specific person or entity named on the cheque.
It can only be encashed or deposited by the payee mentioned on the cheque.
This type of cheque provides more security since it requires the endorsement of the payee.

Crossed Cheque:

A crossed cheque has two parallel lines drawn on its left-hand top corner.
It signifies that the cheque can only be deposited into the payee's bank account and cannot be encashed over the counter.
Crossed cheques are considered safer than open (uncrossed) cheques.

Account Payee Cheque:

An account payee cheque is similar to a crossed cheque, but it includes the phrase "Account Payee Only" or "A/C Payee Only" between the parallel lines.
It ensures that the funds are directly credited to the payee's bank account and cannot be transferred to any other account.

Post-dated Cheque:

A post-dated cheque carries a future date that is later than the current date.
It indicates that the cheque cannot be encashed or deposited until the specified date arrives.
Post-dated cheques are often used for deferred payments or installment-based transactions.

Self Cheque:

A self-cheque is issued by an account holder to themselves.
It can be used to withdraw money from their own bank account over the counter.
This type of cheque is useful when the account holder needs cash or wants to transfer funds to another bank account under their name.