Understanding cheques and cheque security
What you need to know about cashing cheques
- You will need to bring ID to cash a cheque. We may ask you for identification when you cash a cheque and we will explain our reasons for doing so on request.
- Any changes made to a cheque need to be accompanied by full signatures of an authorised signatory/signatories for that account.
- Cheques cannot be accepted before the date that is written on them. If your cheque has a future date, present this for deposit on or after that date.
If a cheque is not presented to us for payment within a certain period of time (usually six months from the date written on the cheque) we may:
- pay the cheque
- decline to pay the cheque or,
- make any further enquiry we consider necessary before deciding whether or not to pay the cheque.
Understanding the instructions or crossings on your cheque
If the words ‘or bearer’ appear on a cheque, this generally means the cheque is payable to whoever presents or ‘bears’ it.
A crossing on the cheque means that the cheque must be deposited into a bank account. If the words ‘or bearer’ appear, this generally can be the account of the person who presents the cheques depending on the wording within the crossing.
Various wording within the crossing changes the drawer’s instructions to the bank. For example, if the cheque is crossed with two lines and reads ‘account payee only’ or ‘not transferable’, the cheque must be deposited into the account of the named payee even though the words ‘or bearer’ appear.
How long it takes to clear a cheque
A cheque paid into your account will show in your account on the day we verify the deposit. If you deposit your cheque in one of our Smart ATM’s or use your BNZ card at our tellers, it will show up that day. It may be the following business day if you use a deposit slip. You won’t be able to use the funds until we are reasonably satisfied that the amounts deposited will be cleared.
Cheques take four business days to clear. This includes the day that the deposit is verified, plus three business days. For example, if a cheque is deposited and verified on Monday, the funds should be available to you on Friday.
Foreign cheques will take longer to clear and are subject to the laws and regulations of the country in which they are drawn. New Zealand Dollar Bank Drafts could be dishonoured up to five business days from the time the draft is verified.
Why a cheque might be be dishonoured
There are a number of reasons why a cheque may not be able to be paid out on. This includes but is not limited to: insufficient funds, amount in words and figures differs, cheque is stale or post-dated, signature is unlike specimen held, and alterations have been made without sufficient signature authority.
You can re-bank the cheque if the dishonour notice you receive states one of the following as the reason for the dishonour:
- refer to drawer
- post dated or,
- effects not clear.
Please phone 0800 240 000, then press * to talk to a Customer Services Representative who can help you with this.
For any other dishonour reasons you should contact the drawer of the cheque in the first instance.
How to protect yourself from cheque fraud
Every year cheque fraud robs hundreds of New Zealanders. Most of the problems occur because a cheque hasn’t been written correctly or because a cheque book has been stolen.
There are some key basic rules to follow.
- Keep your cheque book in a secure place.
- Don’t sign an incomplete or blank cheque.
- It’s important to ensure the cheque can only be banked by the person or company it’s intended for. To do this, write the words ‘Not transferable’ or ‘A/C payee only’ or ‘Account payee only’ within two parallel lines cross across the face of the cheque. Make sure you know the correct payee name.
- You can write the words ‘Not negotiable’ within two parallel lines across the face of the cheque. This means the cheque must be paid into a bank account. A cheque marked ‘not negotiable’ can be transferred to someone other than the person it is made out to, but it still has to be paid into a bank account.
- When writing the cheque amount in words, begin writing as far possible to the left of the space provided and add the word ‘only’ after the amount. This ensures that other words and figures can’t be added.
- Draw a line through any unused portion of the payee or amount spaces, so that there’s no unwritten space.
- If you make an alteration to something you have written, confirm by signing your full signature alongside the alteration.
- If you change your postal address, let us know quickly.