Why an amount on cheque is written in both numbers and words?

Why an amount on cheque is written in both numbers and words?

When writing a check, you have to specify the amount using numerals (in the box on the right-hand side) as well as words (on the line that says “Pay”). This practice helps to avoid confusion; if it’s difficult to read one section, you can double-check the amount using the other section.

Why do banks ask for amount in words and in figures?

While it’s not technically required that you fill out the numeral and written portions of the amounts on your check, the written amount serves as a verification for the bank and helps ensure that your deposit is accurate.

Do you have to write the amount in words on a cheque UK?

Write the amount you’re paying – in words You’ll need to write the amount in full, followed by the word ‘ONLY’. This stops anyone from being able to amend the amount written on your cheque. For example, £56.23 would be written as: Fifty-Six Pounds and Twenty-Three Pence Only.

What happens when a check has two different amounts?

Yes, a check that has different amounts on it can be cashed. If the amounts written in number form does not match the amount written out in words (usually under the name the check has been written pay to the order or) then the amount…

Where the amount mentioned on the cheque differs in words and figures which amount should be considered?

Legal amount and courtesy amount: The amount written in words is called ‘legal amount’ of the cheque and amount written in figures is called ‘courtesy amount’. Where there is a difference between words and figures expressed in a cheque, the amount in words is the amount payable as per Section 18 of N.I. Act 1881.

How do you write words on a cheque?

A:

1. Start writing the cheque with the name of the person to whom you are offering the amount right next to the word ‘Pay’;
2. Write the amount in words specifically in capital letters as close as possible.
3. Write the word ‘only’ after you mention the amount in words.
4. Avoid spaces between the numbers signifying the amount.

What makes a cheque invalid?

This cheque hasn’t been signed correctly e.g. the wrong person signed the cheque. This could be for a number for reasons including the person who has sent the cheque making this request to their bank or a legal restriction being placed on the cheque issuer’s bank account.

How do you write amounts in words in a cheque?

If you have crossed the cheque, strike off the ‘Bearer’ section on the leaf. Write the amount in words. If you are paying, say, Rs1,100, write ‘one thousand and one hundred only’. It is important to write ‘only’ after the amount.

Is it mandatory to write only in cheque?

It is important to write ‘only’ after the amount. This, too, is a way to prevent fraud. In the example above, if ‘only’ is not written after one thousand and one hundred, someone could add ‘ninety nine’ and the amount becomes Rs1,199.

What is the maximum amount I can write a cheque for UK?

2 Answers. In theory there is no limit to the value of a cheque that you can write. However, that doesn’t mean the bank will honour it even if you have sufficient funds in your account – if it appears out of the ordinary, they may block it on suspicion of fraud or money laundering.

What does a banker do when the cheque amount stated in words and in figures differs?

Where there is a difference between words and figures expressed in a cheque, the amount in words is the amount payable as per Section 18 of N.I. Act 1881. It is customary to return a cheque written only in figures with a reason “Amount required in words”.

What is the difference between figure and words?

As nouns the difference between figure and word is that figure is a drawing or diagram conveying information while word is the smallest unit of language which has a particular meaning and can be expressed by itself; the smallest discrete, meaningful unit of language.

Which is better a check written in words or numbers?

Words Prevail Over Numbers. When the amount of a check is unclear, the written words are considered to be the correct amount. Numbers written out with words are clearer; you still know how much the check is for, even if you can’t make out half of the letters. On the other hand, numerical digits are almost worthless if they’re hard to read.

When do you know the amount of a check?

When the amount of a check is unclear, the written words are considered to be the correct amount. Numbers written out with words are clearer; you still know how much the check is for, even if you can’t make out half of the letters.

Is it an offence to not pay a cheque?

You are correct that does not strictly come under Sec. 138 N.I. Act. But your subsequent act of not paying the amount of the cheque, in spite of receipt of a legal notice u/s. 138 does constitute an offence giving a right to the complainant to bring a complaint u/s. 138 N.I. Act.

What do you call the space between the digits on a check?

In fact, on a check, the space where you write the amount is called the “legal line;” the box where you put the digits is called the “courtesy box.” When the Amounts Don’t Match Written words are supposed to trump the numerical digits, but it doesn’t always happen that way.