Professional Documents
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COLLECTIONOFCROSSEDCHEQUES
COLLECTIONOFCROSSEDCHEQUES
• COLLECTING BANKER
• A collecting banker is one who has assumed duty of
collecting the proceeds of a cheque for the customer
or for himself.
• When he collects the proceeds for the customer he
acts as his agent.
• Whereas in case of collecting for himself he is holder
for value because.
• He makes the payment before collection.
• He credits the customer’s account with the value of
the cheque before it is realized.
• The cheque is received in adjustment of an overdraft.
COLLECTION OF CROSSED CHEQUES
• Examination of Crossings:-
• The collecting banker must examine minutely all the
crossings and cheques handed over to him for
collection.
• if the cheque is already crossed specially to any other
bank the collecting banker will not accept it for
collection.
• a cheque bearing account payee only crossing
should be collected only for the payee named in the
cheque and for no one else.
•
COLLECTION OF CROSSED CHEQUES
• Examination of endorsements.
• While making payments the paying banker normally
relies on the collecting banker’s discharge. Therefore,
it is very important duty of the collecting bankers to
examine all the endorsements and other material parts
of all cheques and drafts before presenting them for
collection.
• Notice of dishonour.
• If a cheque is dishonoured on presentation, it is the
duty of the collecting banker to inform his customer
accordingly. Moreover, the banker is entitled to debit a
dishonored cheque to his customer’s account in case
he has already credited it.
COLLECTION OF CROSSED CHEQUES