Technology has revolutionised the banking industry, making transactions faster, simpler, and more convenient. Today, digital banking has become the norm. More and more people prefer making payments through online platforms or mobile apps with just a few clicks. However, even in this digital age, one payment instrument still continues to be an essential feature of the banking industry – the chequebook. Be it paying rent or salaries or clearing bills, a chequebook continues to be used by many.

But cheques are more than just pieces of paper. They are documents that carry legal value and require adherence to several terms. Terms like "payee," "drawer," and "cheque number" all play a significant role in the use of a chequebook. Understanding these terms is important for anyone who uses cheques for payment purposes. Having said that, let's take a closer look at bank chequebooks and some of the important terms associated with them.

What is a bank chequebook?

A chequebook is a booklet, or a set of blank cheques issued by banks to their customers who have different types of savings accounts and current accounts. A cheque is a written instruction from an account holder to their bank to pay a specific amount of money to a recipient mentioned on the cheque. It is a legal instrument that can be used in place of cash for transactions.

A cheque contains specific details, such as the issuer’s name and signature, the recipient’s bank details, and the payment amount. Upon cheque issuance, funds are transferred from the issuer's account to the recipient's account.

Important terms associated with a bank chequebook

  • Cheque payee: The person or beneficiary that the cheque is payable to. The payee's name is written on the cheque, and they are authorised to deposit it. It is important to check that the payee's name is spelled correctly and matches their bank savings account details to avoid any issues during the deposit or cashing process.
  • Cheque drawer: The account holder who writes and signs the cheque. As the drawer, they have the authority to authorise the payment from their bank account. It is essential to ensure that the signature matches the signature on record with the bank to prevent fraud.
  • Cheque drawee: The person or entity directed to make the payment against a cheque. In the case of a cheque, the drawee is usually the bank where the account is held.
  • Cheque drawee: The person or entity directed to make the payment against a cheque. In the case of a cheque, the drawee is usually the bank where the account is held.
  • Cheque number: The first six-digit number printed on the bottom left corner of the cheque. This number serves as a reference for keeping track of transactions by the bank and the account holder.
  • MICR: The MICR code is printed on the bottom of every cheque leaf using MICR (Magnetic Ink Character Recognition) technology. The code uniquely identifies the bank and branch that issued the cheque.


It comprises three parts and nine digits:

  • First three digits represent the city code.
  • Next three digits represent the bank code.
  • Last three digits represent the branch code.



From the payee to the MICR code, a cheque contains vital information that ensures secure transactions between the parties. Despite the rise of online savings accounts and mobile banking apps, cheques remain an integral component of banking services, facilitating everyday transactions for individuals and businesses. So, it becomes important to be familiar with terms related to bank chequebooks to ensure you use them responsibly and effectively to manage your finances.

Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.