Cheques

1. Cheques Kristýna Nevolová

2. Cheque • Check – in American English • Abide by the act number 191/1950, act about cheques and drafts • It is a document, by which the drawer (owner of the current account) unconditionally order the drawee (bank) to pay a sum of money from his account to the owner of the cheque

3. Cheque • Compulsory requirements: • Designation that it‘s a „cheque“ • Order to pay an amount of money – „pay against this cheque“ • The name of the drawee (who has to pay) • Place, where should be pay • Date and place where the cheque was made out • Signature of the drawer

5. Subjects • Drawer – ask (order) the bank to pay a sum of money • Drawee – bank which pay the sum of money form the current account of the drawer • Payee – someone to whom has to be pay • Drawer draweepayee

6. The History of cheques • In the past – very important means of payment • Since 1948 – using of cheques was limited • After 1990 – the original importance didn´t return • Nowadays cheques are used only exceptionally

7. Repayment • The law determine the maturity at sight – after submitting to drawee. • The cheque should be submit at the latest: • In the same state – 8 days • Two different states – 20 days • Two different continents – 70 days

8. Kinds of cheques • By the person payee Cheque to order Cheque on name Cheque to owner • By the drawer Bank cheque Private cheque • Special kinds of cheques Cheque to be cleared Travel cheques

9. Kinds of cheques • A) cheque to order there is notice „to order“ or „transferable by endorsement“ – the owner can write a new person on the back side of the cheque • B) cheque on name there has to be name of the person whom will be pay. The name of payee. „Without endorsement“ • C) cheque to owner if there isn‘t name. The sum of money will get the person who submit the cheque

10. Crossing • Cheques are usually printed with two lines which are called the crossing. • A crossed cheque means that the money can only be paid into a bank account. • If the cheque is crossed „Account payee“, it can only be paid into the account of the person named on the cheque

11. Cheques with crossing

12. The drawer • Bank cheque • The drawer is a bank, the drawee is another bank • Very high quality • Private cheque • legal person (corporate) or private person

13. Special kinds of cheques • Cheque to be cleared • Can‘t be repay in cash, only transferred to the current account • Travel cheque

14. Travel cheque • Use in international tourism • The well known drawers – VISA, American Express • Requirements: • Designation that it is a travel cheque • Order or promise to pay the sum of money to a payee • Name of the drawer and his signature

15. Travel cheques • Different using: • before the journey client buy travel cheques in his bank • He sign these cheques before the employee of the bank • In foreign country the client sign the travel cheques again in front of the employee of the repaying bank • The signatures have to be identical

16. Travel cheque

17. Advantages and disadvantages • Advantages • You don‘t have to carry large amounts of cash with you • Your money is on a bank account where it is safe from loss or theft • It can be done anywhere without going to a bank • It minimize a risk of loss or theft of huge amount of money

18. Advantages and disadvantages • Disadvantages • The bank cheques are quite expensive – about 300 CZK for the make out • The private cheque could be bad cheque and it‘s very difficult to check it. Issuing the bad cheque is offense (criminal act) and the bank doesn‘t repay it • For using cheques is necessary to have much more money on your current account

19. Questions • Which kind of cheque isn‘t abide by the act number 191/1950 act about cheques and drafts? And in which act is abide by? • Are bank cheques used more by private clients or by corporations? • Why aren‘t cheques popular in Czech Republic?

20. More disadvantages • Long time between transmit and repayment – days or weeks • Fee connected with cash the cheque