Cheque bounce with the reason Loose Cheque?
You have presented a cheque for payment and it’s been declined for the reason loose cheque. What could it mean? Why it has certain limitations to the normal cheque leaves that we have?
Loose cheques are those cheques that banks provide for emergency use only. Under normal circumstances when a user applies for it, the bank provides cheque booklets in the range of 10, 20, 50, 100 leaves and so on. You can even go for 1000 cheque leaves if you want.
A loose cheque is a non-personalized cheque given to the user. Personalized cheques are those which are mapped to your account. All your details will be imprinted on the cheque leaves. Information such as your name, account number and payment limit is printed on the leaves.
A personalized cheque can be seen either as a bearer or order cheque, whereas a loose cheque is normally seen only as an order cheque. This means a loose cheque can be paid only by order.
What is loose cheque?
A loose cheque is a type of cheque provided by the bank for emergency use. Features are the same as the normal cheque but there will be no account number, user name and payment limit imprinted on the cheque leave as its a non-personalized cheque.
Any type of account holder can have the facility. It may be a Savings bank account, Current account or CC account. It is meant for only home branch transactions.
These cheques are not accepted at the clearing house due to security reasons. So, if you are thinking of making a third-party payment with a loose cheque, it might get rejected. That is why your cheque is getting bounced even after having a sufficient balance in the account.