Check Spelling Rule: Your bank check could be canceled due to incorrect spelling! Learn about RBI's new rule

In India’s banking system, cheques remain one of the most widely used financial tools for making payments and transferring funds. However, a common confusion among customers often arises when writing the amount in words — especially between “Lakh” and “Lac.” Many people use the two words interchangeably, but there’s a subtle yet important difference that could affect how your cheque is processed.

According to the Reserve Bank of India (RBI), the officially recognized spelling for ₹1,00,000 is “Lakh.” This is the word used across all formal documents, currency notes, and RBI publications. On the other hand, while “Lac” may appear frequently in everyday speech or informal writing, its meaning in English is entirely different — it refers to a type of resin used in varnishes and polishes, not a unit of money.

In its internal banking guidelines, the RBI has clarified that “Lakh” should always be used in all official financial and banking documents, including cheques, drafts, and pay orders. The use of “Lakh” ensures uniformity and reduces the possibility of confusion or misinterpretation by bank staff during cheque processing.

That said, customers need not panic. The RBI has not issued any strict directive to cancel cheques that use the word “Lac” instead of “Lakh.” In practice, most banks do not reject cheques over this minor spelling difference, provided the amount written in figures matches the amount written in words. Still, experts recommend using the correct and standard spelling — “Lakh” — to maintain professionalism and avoid any potential disputes in the future.

When filling out a cheque, even small details like spelling and punctuation matter. A misplaced word or unclear handwriting can raise doubts about the cheque’s authenticity and lead to unnecessary delays. To ensure accuracy:

• Always write the amount clearly in both figures and words.

• Use “Lakh” instead of “Lac” for ₹1,00,000.

• Add the word “Only” after the written amount (for example, “Ten Lakh Only”) to prevent anyone from tampering with the cheque.

• Avoid overwriting, cutting, or leaving blank spaces that could be misused.

Financial advisors suggest that being consistent with official terminology not only enhances the credibility of your documents but also reflects financial awareness. Since “Lakh” is recognized across all Indian banks and regulatory systems, using it helps maintain clarity and trust in transactions.

While it’s unlikely that your cheque will be cancelled merely for using “Lac,” adopting the RBI-recommended spelling is a simple yet effective habit to avoid confusion and ensure smooth clearance.

So, the next time you’re writing a cheque — whether it’s for ₹10,000 or ₹10,00,000 — make sure to spell it right. “Lakh” is the correct term, both linguistically and officially. Writing cheques with precision not only safeguards your money but also demonstrates financial discipline.