A voided cheque is a financial tool which used primarily for quick and straightforward access to a person’s banking information. It has all of the data that a regular cheque would have, but because it is voided- the word void is written on the front of the cheque in big, bold letters.
Though a cheque has the intended recipient’s banking information written either on the front or back, a voided cheque is an easy way to pass on the banking information to set up financial transactions such as recurring deposits without the risk of anyone using the cheque to submit payment.
Process of a Voided Cheque
The term voided is written across the front of a voided cheque. In order to prevent unintentional use, it is often written in bold and monumental letters.
Voiding a cheque prevents it from being used as a blank cheque. In other words, a thief who steals a canceled cheque cannot make it payable himself, inserts a vast sum, and signs it.
Interpretation of a Voided Cheque
You can offer a voided cheque if the payroll division of your business requires one from you in order to set up a direct deposit. The cheque can be voided then, making it impossible for anybody to alter it.
When To Use A Voided Cheque?
A void cheque is best used in situations where someone requires you to have banking information. They are fast, efficient ways to show the receiving bank:
- Baking Details
- The fact that you have a bank account open with another registered institution.
In addition to simply showing the receiving bank your details, this also acts as a soft form of verification; people with bad intentions rarely have any void cheque because in order to access a chequebook, one needs to have developed some sort of trust with a previous financial institution.
Therefore, void cheque act as a social sign that you’re well-adjusted, and many banks require either a void cheque to set up an account- even if you have all the basic requirements of banking information.
How To Get a Voided Cheque?
Voided cheques are the easiest to grab. There are various ways to do it. Firstly, you can request a void cheque from your bank- many banks have designated void cheques with a typical voiding procedure to maximize security and decrease the likelihood of someone using that cheque to create a payment.
This approach can eventually take some time, though usually, the bank needs to print voided cheques for you. An alternative approach is voiding cheques yourself. This allows you to do the voiding yourself without the need to wait several days for a bank to print the voided cheques for you.
To void a cheque yourself, all you need to do is grab a pen, take your cheque, and write “VOID” in vast capital letters. Ensure that your writing covers the length and height of the cheque like a malicious criminal would be unable to piece a cheque together from multiple small pieces of the areas that you didn’t write over.
Reasons For Voiding A Cheque
Establishing Direct Payments: If you wish to arrange electronic payments, whether it is for personal use, you may need a voided cheque at your disposal. For instance, voiding a cheque can be required to set up automated payments if your firm has vendors who prefer to be paid electronically.
Automatic Deposit: Your firm will need to have your bank account number and routing number in order to begin direct deposit, which can speed up the payment process for you.
Regular Payments of Bills: If you want to schedule payments from your cheque account to pay your mortgage auto loan, you might need to submit a cancelled cheque.
If you want to generate paystub, your initial choice should be eFormscreator. We hope that this blog will cover everything about voided cheques and how you can use them.