Does Cashing a Cheque Leave a Paper Trail?

Does Cashing a Cheque Leave a Paper Trail?

If you have cashed a cheque from financial institutes like banks, credit unions, etc. then it will definitely leave a paper trail.

A cheque is a widely used financial document to make payments, pay bills, transfer the balance from one bank account to another, etc. There are many ways you can cash a cheque. But depending on how you have cashed a cheque, there might be a paper trail of that check. So, if you are wondering how cashing a cheque leaves a paper trail then keep reading the article.

Key Takeaways

  • A cheque is an unconditional order in writing
  • Cheque payment is always made in the form of cash
  • Cashing a cheque from a bank or credit union will leave paper trails  
  • Most cheques have 3 months validity from the issuing date
  • A cheque must have the signature of the exchequer  
  • Crossed Cheques can’t be cashed by the bank teller
  • Cashing a cheque from a cheque cashing center won’t leave any paper trail 

What is a Cheque?

According to Wikipedia

“A cheque, or check, is a document that orders a bank or credit union to pay a specific amount of money from a person’s account to the person in whose name the cheque has been issued. The person writing the cheque, known as the drawer, has a transaction banking account where the money is held. The drawer writes various details including the monetary amount, date, and a payee on the cheque, and signs it, ordering their bank, known as the drawee, to pay the amount of money stated to the payee.”

This is a financial document that is considered an unconditional order in writing. A cheque makes the financial institute obliged to transfer the fund to the payee’s account. The payment of the cheque is always made in the form of cash. Usually, there is no expiration date on a cheque but if there is a date on the cheque then the cheque remains valid for 3 months after the date of issue. A cheque must have the signature of the exchequer or the cheque won’t be valid.

What is a Cheque?

Types of Cheque

There are quite a few types of cheques available. 10 main types of cheques are –

  1. Bearer Cheque: Here, the bearer of the cheque will receive the money specified on the cheque
  2. Order Cheque: In this type of cheque the words “or bearer” are canceled out. So, the person whose name is written or printed on the cheque will be able to withdraw the money.
  3. Crossed Cheque: This type of cheque has two slightly bent, parallel lines on the top left corner, and within the lines written the word “a/c payee.” Here, the funds are transferred from one organization to another.
  4. Open Cheque: This type of cheque can be cashed at either the payer’s bank or the payee’s bank. These types of checks don’t have crossed lines like the crossed cheque.  
  5. Post-dated Cheque: This type of cheque can only be cashed after the date written on the cheque.  
  6. Stale Cheque: This type of check passed its validity date and the funds can’t be withdrawn.
  7. Traveler’s Cheque: Usually, this type of check is issued by banks, and the cheque bearer can cash the cheque at another bank in another country.
  8. Self Cheque: This type of cheque has the word ‘self’ written on it. The bank account holder can only cash this type of cheque. 
  9. Banker’s Cheque: This type of cheque is issued by banks on behalf of the account holder. This type of cheque remains valid for three months from the issue date.
  10. Blank Cheque: This type of cheque has only the sign of the issuer. There is no other information like issue date, amount, payee name, etc.   

How to Cash a Cheque?

How you can cash a cheque depends on the type of cheque you have. If you have a bearer cheque then you can easily cash it from the issuing bank. Go to the bank and submit the cheque to the bank teller. After verifying the cheque, the bank will clear the cheque and you will receive the funds. The same process goes for order cheques, open cheques, self-cheques, etc. If it is a crossed cheque then you have to bring the cheque to the bank, with that name written on it. Depending on the bank policy, you might have to show a valid photo id and other documents before you can cash a cheque.

Is it Possible to Trace a Cashed Cheque?

Yes, it is completely possible to trace a cashed cheque. When we cash a cheque in a bank, the bank keeps a record of the transaction. Moreover, most banks require a valid photo id to cash a cheque. When you submit a cheque with documents; the bank authority saves some information on their database like the cheque number, cheque issuer’s name and account number, payee’s name, payee’s photo id number, payee’s address, etc. This information is more than enough to trace a cashed cheque. Moreover, if the cheque amount is $10,000 or above then the bank sends the information to IRS and the IRS keeps the information in its database. So, if you are chasing a cheque from a bank or credit union then it will leave a paper trail and the transaction will be easily traceable.

Is it Possible to Trace a Cashed Cheque?

How to Cash a Cheque without Leaving any paper Trail

Well, it is possible to cash a cheque without leaving any paper trail and the process is very easy. You have to make sure you don’t cash the cheque at a bank or credit union. You have to look for a cheque-cashing center where you will be able to cash a cheque without any paper trail. Moreover, you can also consider using another person’s name while cashing a cheque. This is another way you can avoid a paper trail leading back to you. There are lots of cheque-cashing services available. Different service offers different types of deals, so compare the check cashing services before cashing your cheque.

References:

https://www.answerpail.com/index.php/59018/does-cashing-a-check-leave-a-paper-trail

https://www.idfcfirstbank.com/finfirst-blogs/finance/types-of-cheques

https://www.profitableventure.com/cashing-paper-check-leave-trail/

Last Updated on September 5, 2022 by Ana S. Sutterfield

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