Blank Cheque


It’s hard to deny the fact that at some point of life, we all had made a payment through a cheque, instead of shelling out hard cash. Even in the age of digital era, cheque continues to remain a significant mode of transactions at which most people rely for making convenient and hassle-free payments.

However, while making use of a cheque, a person should take certain protective measures into consideration to avoid any fraud or alteration of a cheque. Often when a person buys something or borrows loan/credit, he or she is asked to present blank cheques as security. When a person or authorized signatory signs a cheque before filling payee and amount details, the cheque is said to be a blank cheque. The use of blank cheques is more raging in the corporate world than for a common man.

Even though a blank cheque is widely practiced in the corporate world, it may be noted that it carries high risk of being misused for illicit purposes. Therefore, while filling out a blank cheque, certain measures should be taken in order to avoid misuse or any fraudulent activity through a cheque.

Precautionary measures to keep a cheque safe:

• Keep record – Always remember to keep a track record of all cheques being issued, either blanked or duly filled. This would help you to track the records later.
• Keep safe – Never ever leave a blank cheque unattended, even when you completely trust a person. Remember that a blank cheque is always open for fraudulent activity or misuse. Thus, it’s better to be safe than regretting later.
• Put a cross – Whenever you’re issuing a blank cheque to any person or party as a security, make sure to put a cross over it. This would save you from any misuse or alteration of payment.
• Keep a count – Always remember to keep a count of all cheques in a cheque-book. Whenever you get your hands on the cheque book, count the number of cheque leaves and track it with the number of leaves you’ve issued till now. If there seems any discrepancy, make sure to bring the issue to the notice of bank authorities immediately.
• Don’t sign – Note it down in bold, ‘never sign a blank cheque until for a valid reason’. Always double check the purpose before issuing a cheque for it.

Word of caution:

Whenever handing over a cheque, remember to write the payee’s name and contact number at the back of a cheque to avoid any case of discrepancy.