How Does Cheque Depositing Work?
Ever wondered what happens to your cheque after you have passed it over to the bank teller serving you at the counter?
It is not a bizarre fact that some of us are a little apprehensive when it comes to depositing of a cheque, especially when you are tasked to do so on behalf of the company you are working in.
This is because depositing it does not only involve simple conversion into cash, but also, there are other aspects of cheque deposition that one needs to be aware of.
Ok let me share with you the three steps on how your cheque is credited into the account where it should be stored …
1. Before depositing the cheque, as the recipient, ensure that it has been carefully filled with the correct amount and currency, and has been clearly signed by the person who gave it to you. Afterwards, pass the cheque to the counter for verification purposes, together with your name, contact and the account number.
2. The next step that takes place is the clearance of the cheque. The bank has to make sure that the cheque is valid for being credited into the account. Should the cheque be deemed unaccepted by the bank, it will ‘bounce’ back to the recipient and the giver. This can happen either because the information provided in the cheque is insufficient or invalid, or there is a problem in the conversion of the currency where foreign currencies are concerned. The cheque has to be re-written correctly, and for the case of cheques written using a foreign currency, it should thus be written using the currency of your country.
3. Considering that the cheque is valid, the stipulated amount will then be credited into your account and will be reflected on your statement of account. The amount will automatically be converted to cash, so that will add up to the totality of your cash at bank.
In the Singapore banking context, the cheque deposited will be processed on the day of the deposition. If you pass the cheque later than the due time that is set, it can only be processed on the next day. It will be ready to be credited into your account on the following day, but if you deposited the cheque on Friday, you would have to wait till Monday for it to be credited.
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