Details on Cheque That You Should Know

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By definition cheque is a specially printed form, containing an individuals bank account details, to order bank to pay a specific amount from his or her account to the person whose name has been written on it. Here we will together understand what details are printed on a cheque.

Understand details printed on a bank cheque for example cheque number, MICR code, cheque ID and the like

You can see many details on cheque for instance numbers, codes and other details. If you already aware of them then pat your back because you're one of the only few people who understand the details on cheque! If you don't know, don't despair, I'll help you understand your bank cheque details.

Above is an HDFC Bank cheque photo. All banks cheque look like this; just the format and color theme change. If you see SBI cheque or other bank's cheque then you'd hardly find any difference.

At the top, you can find IFSC Code. All bank branches who allow National Electronic Fund Transfer have Indian Financial System Codes (IFSC). To transfer money electronically, you've to mention your bank's IFSC Code.

You can also see your bank account number on your bank cheque and at the bottom right corner you can see your name.

Now, if you look at the bottom line of your bank cheque then you'll see some numbers or codes there. First 6 numbers are your cheque number.

Next 9 numbers are your MICR code. MICR stands for Magnetic Ink Character Recognition. This number helps banks do cheque sorting quickly. With MICR code, machine understands your cheque belongs to which bank and where its location is.

Everyday large banks receive thousands of cheques therefore manual sorting and processing is not possible. Bank introduced this MICR code to do the job in few seconds with the help of machine. MICR code is further subdivided into three parts.

MICR code's first three digits help machine to recognize the location of branch who has issued this cheque; usually these are your city PIN code's first three numbers. Next three digits help to know the name of the bank for e.g. HDFC bank code is 240 and SBI bank code is 002, and similarly last three digits show exact bank branch location.

After MICR code, we've 6 digits Account ID code. It is not that important but it shows your bank account details.

In the end, we've Transaction ID. With help of Transaction ID, machine knows whether your cheque is a local cheque or payable at par at all branches. If your bank cheque is a local cheque then it can only be deposited in your home bank branch. Or if it belongs to second category then it can be deposited in any bank branch.

Now you know what details are printed on a cheque. Before I show you how to fill cheque, Let's take a look at some important points that we should remember while filling cheque.