With the blast of web and web-based advertising, everything without exception under the sun is only a couple of snaps away. Much the same as each different business area, notwithstanding saving money has gone hard and fast in giving different administrations internet, making lives simpler for many clients. This includesÂ Fixed Deposits,Â Savings AccountÂ andÂ Loans. Yet, even asÂ online bankingÂ is developing exponentially, there are sure parts of keeping money that should be dealt with generally.
Issuing drop checks is one such process that should be done physically. While everybody knows about installment through checks, youthful internet saving money clients have a tendency to have questions about crossed out checks. Along these lines, how about we simply ahead and clear your questions!
What is a Cancelled Cheque?
A cancelled cheque in India simply refers to any cheque that has strike marks on it with the words â€˜cancelledâ€™ written across. A cancelled cheque is considered to be proof that you actually hold an account with the bank. From withdrawal ofÂ EPF fundsÂ to set up anÂ Electronic Clearance ServiceÂ from the account, a canceled cheque is required in many cases.
Issuing a Cancelled Cheque
To cancel a cheque leaf, all you need to do is draw two parallel lines across the cheque and write â€˜Cancelledâ€™ in between the two lines. A canceled cheque doesnâ€™t require your signature. It gives details such as account number, account holderâ€™s name,Â MICR code, name and branch address of the bank.
Though no one can withdraw money from your account using a canceled cheque, fraudulent activities using a canceled cheque have happened in the past. So be very careful when you issue a canceled cheque and make sure that the person you are handing it over to is extremely trustworthy. Got it?
Use of Cancelled Cheques
- Most investment organizations give utmost importance to Know Your Customer (KYC) guidelines. So if you areÂ investing in Mutual FundsÂ or the stock market, the company will ask for a cancelled cheque to verify if the account associated with the investment actually belongs to you.
- From purchasing of accessories like a mobile phone, TV or fridge to applying for aÂ Car Loan,Â Home Loan,Â Education Loan, etc., EMIs have become the favorite mode of payment. And to set the process of EMIs rolling, a canceled cheque is required as proof that you hold a bank account.
- A canceled cheque is needed to set up the Electronic Clearance Service, which automatically deducts money from your account every month.
- To withdraw your provident fund amount, companies generally ask for a canceled cheque with your name on it to validate your account details.
- Even while purchasing an insurance policy, a canceled cheque is required.