Crossing of cheques is a practice in banking where two parallel lines are drawn across the face of a cheque. The purpose of crossing a cheque is to provide instructions to the bank regarding the payment of the cheque. It adds an extra layer of security and ensures that the cheque can only be deposited into a bank account and not be immediately encashed at the counter.
Crossing a Cheque can be done in Two ways
General Crossing
When two parallel lines are drawn across the face of the cheque without any additional words or instructions, it is considered a general crossing. A general crossing signifies that the cheque can only be deposited into a bank account and not be cashed over the counter. It adds a layer of protection by ensuring that the payment goes through the banking system, reducing the risk of loss or theft.
Special Crossing
In addition to the parallel lines, a special crossing includes the name of a specific bank or a specific branch within the parallel lines. This type of crossing directs that the cheque be deposited only into the account of the bank specified. It provides further instructions to the bank, ensuring that the funds are credited to the specified bank or branch and not any other.
Crossing of cheques serves the following purposes
Prevention of Fraud
By crossing a cheque, it becomes more difficult for unauthorized individuals to encash the cheque. The payment must go through the banking system, making it easier to track and verify transactions.
Enhanced Security
Crossing adds a layer of security to the cheque by making it payable only through the banking system. This reduces the risk of loss or theft and ensures that the funds reach the intended recipient.
Encourages Banking System Usage
Crossing encourages the use of the banking system for financial transactions. It promotes the practice of depositing cheques into bank accounts, contributing to a more efficient and transparent financial system.
