Cheques and Its Processing


 
 
Concept Explanation
 

Cheques and Its Processing

Cheque and Its Processing : A cheque is a document that orders a payment of money from a bank account. The person writing the cheque, the drawer, usually has an account where his money was previously deposited. The drawer writes the various details including the monetary amount, date, and a payee on the cheque, and signs it, ordering his bank, known as the drawee, to pay that person or company the amount of money stated.

Cheques are a type of bill of exchange and were developed as a way to make payments without the need to carry large amounts of money. There is also at least one endorsee, which would typically be the financial institution servicing the payee's account, or, in some circumstances, may be a third party to whom the payee owes or wishes to give money.

 
 


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