Many of us love our bank account’s online capabilities, and find it convenient to order cash through an app or transfer money quickly.
That said, cheque books are still relevant for many bank account holders.
What are cheque books?
A cheque book is a booklet of paper cheques that can be used to pay someone using the funds in your transaction account. Typically, a cheque book can be ordered through your bank and linked to an existing bank account.
How do cheques work?
After you’ve written a cheque and given it to the person or business you’re paying, they will take the cheque to their bank to deposit into their own account. The cheque is then usually sent back to the issuing bank for approval. After the bank has approved, or ‘cleared,’ the cheque, they will authorise for the amount listed on the cheque to be paid to the person or entity that deposited the cheque.
Do I need a cheque book?
Many bank account holders today decide not to have a cheque book. This decision is usually due to the fact that many bills can now be paid online rather than by cheque. If you’re able to spend money and pay bills without a cheque book, there’s likely no reason for you to have personal cheques.
There may be some situations that you find yourself needing to pay by cheque. This might be a matter of paying a large sum or having to send funds through the mail. Either way, many banks can issue their customers a financial institution cheque. While many banks charge a fee for the service, it’s usually modest.
Are there fees associated with cheque books?
Many banks charge fees associated with writing or depositing cheques. One of these fees is a cheque-issuing fee, which applies if you need your bank to issue you a cheque.
Another common fee is a clearing fee. This fee applies when you have written a cheque to a third party and their financial institution has sent the cheque to your bank to be approved, or ‘cleared.’
Your bank may also be charged a withdrawal fee. A withdrawal fee might apply if someone has written you a cheque and you need to cash it at your bank.
Who should consider ordering a personal cheque book?
Many account holders today don’t feel they need a personal cheque book. However, if you find yourself needing bank-issued cheques often, it might be worth considering your own cheque book.
There are many reasons you might write cheques regularly. Whether you often pay institutions that are not set up to accept electronic payments or you run a small business, having a cheque book on hand can end up being cheaper than running to the bank every time you need a cheque issued.
If you’re considering ordering a personal cheque book, talk with your bank. You may be able to link a cheque book to an existing account or open an account that’s compatible with cheques.