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Question

Difficulty: EasyMeans of Payment in Home Trade

A crossed cheque can be cashed immediately over the counter at any commercial bank by the payee.

Answer: Answer

Answer

The statement is false. A crossed cheque cannot be cashed over the counter; it must be paid into a bank account.
The statement is false because crossing a cheque directs the paying banker to pay the money into a bank account, preventing the holder from receiving cash over the counter for security purposes.

Step-by-Step Solution

1
Identify the defining features of a crossed cheque.
A crossed cheque bears two parallel transverse lines drawn across its face.
Crossing acts as a specific direction to the paying banker regarding how payment must be executed.
2
Determine the legal payment process for crossed cheques in home trade.
The bank must pay the proceeds only to a bank account, not in cash across the counter.
This payment restriction provides security by ensuring a paper trail for the transaction.

Key Concept

Crossed Cheques vs Open Cheques in Home Trade
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Topics

Means of Payment in Home Trade

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