How to write a cheque
Personal Cheques: When you open a chequing account at a bank, you will have an option to receive `personal cheques`. Personal cheques are a book of cheques that you can use as currency for purchases and payments you wish to make.
A chequing account is the most common type of bank account that most people will have. Chequing accounts are now called different things sometimes such as “day to day banking account’, ‘daily banking account’, or other similar names. The reason is that it is becoming rarer to write personal cheques these days. Cheques are now replaced by debit cards for most daily purchasing in Canada and the United States. When you make a purchase with a debit card, you will be asked to choose your account type and will be given an option between chequing and savings.
Paycheque / Paycheck: This is the pay you receive for doing your job at your workplace. Although it is rare to receive an actual cheque these days we still commonly use the word ‘paycheck’. Usually, your paycheck is deposited directly into your bank account (most likely a chequing account).
Post dated cheque: a post dated cheque is a cheque which is dated payable for a future date. Usually when you enter into a lease to rent an apartment you will be asked to provide post dated cheques. For example, if you rent an apartment, at the beginning, you will probably be asked to provide 12 ‘post dated cheques’ for the monthly rent, each dated for the first day of each month for the entire year.
Write a cheque / cash a cheque / cheque clearing: We use the expression, “write a cheque”, because that is exactly what we do, we write in the information including the date, people to pay to and the amount of money on a cheque.
When you write a cheque and use it to pay someone for something, you are actually giving that person permission to make a demand on your bank account to pay the amount you write in the cheque. This is called cashing a cheque.
When the payee (person you make the cheque payable to) cashes the cheque, your bank will take money in the amount you indicated on the cheque from your bank account and give it to the person. This is called the cheque clearing process. If you have enough money in your account the cheque will clear, if you don’t have the money, the cheque will “bounce.” This means it will be sent back to the payee from the bank with a message saying that there is not enough money in the account.
Cheque writing role play: You can set up role plays such as in a department store or an open air market, the options are endless. ESL students can barter or negotiate over the price in English and seal the deal with a cheque.
Extra lesson / vocabulary / discussion: What happens if a cheque bounces? Will you charge an NSF (Non-Sufficient Funds) fee? Did the cheque clear yet? Use your imagination and use our props to make it happen. Do you have to give post-dated checks for your rent, or other purchase?
Cheque Tips & Vocabulary:
- Date: always be sure to date your cheque to ensure you, as the cheque writer, state when it is valid. What could happen if you don’t date the cheque?
- Payee: You, as the cheque writer are the payor, and the person you give it to is the ‘payee’. This means that the payee can “cash” the cheque, or “deposit” the cheque into his or her bank account. What could happen if you leave the payee blank?
- Pay to the Order of: a cheque is a type of demand currency note. In other words it upon the demand by the payee, the cheque is treated as money. However, the person or bank cashing the cheque does not have to accept it. There is risk involved to the person taking a cheque, it may “bounce”.
- Bounce a cheque: for a cheque to bounce means that the bank returned it, after depositing or cashing it and said that the payor has not enough money in his or her account to pay the amount of the cheque.
- Post dated cheque: this means you date the cheque for later, in the future. Often in Canada and the USA, when people pay rent for their apartment they have to give their landlord post-dated cheques for the rent payments.
Use the below sample cheques to learn how to write a cheque.