A banker’s cheque is almost confusing to understand as it seems similar to other cheques, but the article will remove all your ambiguities about the banker’s cheque.
The bank guarantees a banker’s check, which is identical to a banker’s draft. This pay order is created using bank money and is signed by a cashier. Banker’s cheques are mostly used to pay for institutional purchases, brokerage transactions, and real estate. To receive the specified sum of money, the beneficiary must deposit a banker’s cheque with the bank. One day following the deposit, the checks are often cleared.
Features of a Banker’s Cheque:
A banker’s cheque has a few distinguishing characteristics. It includes the payee’s name; the amount to be presented (written in both alphabets and numerals), the name of the issuing bank; its placement (top left-hand corner or upper centre); and a printed (facsimile) signature of the cashier or senior executive officer of the bank.
Additionally, a banker’s cheque has some security components like a watermark, security thread, color-changing ink, and special bond paper. The cheque is more resistant to counterfeit goods because of all these aspects.
Other characteristics of a banker’s cheque include:
Banker’s cheques are only issued for the designated bank’s clearing area, because it is subject to local law, it can be cleared at any branch of the same bank and city.
A banker’s check is effective for three months from the date of issuance.
Unless it is a fake, a banker’s cheque cannot dishonour at all.