One signature on the back of the cheque and all the money disappears, 90% of people do not know this important rule of RBI, then later they make rounds of the bank.

By the way, have you ever wondered why we have to sign on the back of the cheque and what is the rule for this? So today we will know why we sign on the back of the cheque, and does signing keep the money safe or can there be fraud? By the way, 90% people are unaware of this important rule.

Often everyone is confused about whether one should sign on the back of the cheque or not. This is the reason why some people sign on the back of every cheque, while some never do. But the truth is that it depends on what type of cheque it is and who is cashing it. To understand this confusion of bearer cheque, it is important to first know the two types of cheques.

Actually bearer cheque is considered to be the most common but the most risky cheque. The name of the person to whom the money is to be paid is written on it and further "Or Bearer" is written. This means that if this cheque falls into the hands of anyone else, he can go to the bank counter and get it cashed, even if his name is not written on the cheque.

Account payee cheque is considered to be the safest cheque. Two diagonal lines are drawn on the upper left corner of this cheque and "A/c Payee Only" is written. By the way, this means that the money of this cheque will not be given in cash, rather it will be deposited only in the bank account of the person in whose name the cheque is.

Let us tell you that RBI's rule is that the signature on the back of the cheque applies to Bearer Cheque. Actually, if a person cashes a 'bearer cheque' issued in someone else's name in the bank, then at that time the bank can ask him to sign on the back of the cheque for identification and record.

It is clear that the bank gets signatures on the back of the cheque for its security and record. The signature on the back of the cheque is proof of who has received the money. If there is any dispute in the future or if the cheque is stolen, then the bank can prove to whom it was paid.

Let us tell you that many times when you go to cash a bearer cheque in your own name, even then the bank employee can ask you to sign on the back of the cheque. However, this is only as a receipt that you have received the money. However, there is no need to sign on the back while depositing an account payee cheque.

Everyone should keep in mind that whenever you make payment to anyone, you should always use an account payee cheque (A/c Payee Cheque). This makes it clear that the money is going to the account of the right person. Always avoid giving a bearer cheque, because if it is lost, anyone can misuse it. So it is always important to be alert before signing on the back of the cheque.