Issuing or Receiving Cheques

Cheques and paper items are declining steadily, yet they remain one of the most popular payment methods for many businesses in Canada.
 

Writing a cheque

When writing a cheque, it's important to use dark ink so the information shows up well in images If writing a cheque by hand, we recommend you use a ball-point or roller pen with black or blue ink. On the computer, use at least a 10 point font and dark ink colours (black, blue or dark purple). You should include the amount of the payment in words since it serves as a backup if the amount in figures is unclear. It's acceptable to wrap the amount onto two or more lines.

Accepting and depositing a cheque

When you're given a cheque, make sure all the necessary fields are complete and that it has a signature on the front.

If a cheque is for more than one person or company, it needs to have the other party's signature on the back of the cheque. Or, if someone is giving you a cheque made out to them, it also needs their signature on the back. For example, if the cheque is for your company and John Smith, you need John Smith's signature on the back to deposit it. Signatures on the back of cheques are called endorsements. If you're unsure whether a cheque is acceptable, check with your financial institution.

When preparing your deposits, review the date on each cheque.

Post-dated

Cheques shouldn't be deposited before their due date. Given the large volume of cheques and automated processing, some items may slip through. If the recipient deposits a cheque you wrote early, you should contact your financial institution. Your financial institution can return the cheque, up to and including the day before the due date.

You will need to make other arrangements for payment, as you can't deposit a returned cheque.

Stale-dated

Cheques are considered stale-dated after six months, unless it is a certified cheque. A stale-dated cheque means that the item is old, and not necessarily invalid. Financial institutions may still honour these items, but there is no obligation to do so. Government of Canada cheques, money orders and bank drafts do not 'stale-date'. Cheques issued by provincial governments are treated as regular cheques and may be considered stale after six months. To learn more about cheques, view Module 03 (Cheques) of our educational video series – the Payments Canada Learning Exchange. For more details on Payments Canada's official specifications for cheques, please refer to Standard 006 for paper items and to Rule A10 for cheque imaging specifications on our website.