What is Post Dated Cheque?

While reading something, I came across the term Post dated cheque. I didn’t know what it was and to know about it, I asked my father. I asked him about the post-dated cheque meaning. My father said post dated cheques are nothing special and are very similar to a normal cheque. After that, he explained what it meant. 

What Does Post Dated Cheque Mean?

My father told me that a normal cheque that has a future date written on it instead of the date on which it is issued. This cheque can only be honoured by the bank on or after the date written on it. 

He also said that the as per the regulations of the Reserve Bank of India, a post-dated cheque is valid for three months from the date written on the cheque. 

Next, he told me about the legal consequences of dishonoring a post-dated cheque. According to my father, Post Dated Cheques or PDC are governed by the Negotiable Instruments Act. As per the regulations laid out in the act, not following the rules can result in the following penalties. 

• Imprisonment for up to one year.

• A fine up to twice the amount mentioned in the cheque. 

The act also states that, if the cheque is dishonored, then the payee should send a legal notice within 30 days and the issuer should respond within 45 days. 

The

meaning of post dated cheque

is a cheque issued with a future date written on it. In India, post-dated cheques are commonly used in various financial transactions, including loan repayments, rent payments, and installment payments.

The practice of using post-dated cheques helps you in scheduling payments on specific dates and provides a form of security for the payee.

Here are some key points related to

PD Cheque meaning

:

• It bears a date that is later than the date on which it is written. This means the cheque is not meant to be cashed or deposited until the specified future date.

• These

  are legally recognized and accepted as a valid instrument. However, presenting a post-dated cheque before the agreed-upon date is not permissible.

• Borrowers often issue post-dated cheques to lenders as a method of repaying loan installments on specific dates. 

• Tenants can provide post-dated cheques to landlords for monthly rent payments.

• Businesses and individuals use post-dated cheques to facilitate payments in installments.

• Post-dated cheques allow the issuer to ensure that sufficient funds are available in the account on the specified date.

While post-dated cheques are commonly used, there are risks associated with them. You should only issue post-dated cheques to parties you trust. Well, I hope this clarifies your doubts around

what is the meaning of PDC cheque

.

Read more

Even though digital payments have become popular nowadays, you must have come across a cheque at some point in your life. I have written several cheques in my life, so I can explain the post dated cheque meaning.

A post-dated cheque is a form of a cheque drawn with a future date mentioned on it. In simple words, it is a cheque that is drawn with a date which is after the date on which the cheque was written. I’ll explain this with help of a simple example:

Let’s say today is 17th January and you’re writing a cheque. Usually, when you write a cheque, you have to write the present date of the cheque (17th January in this case). However, when you write a date that is later than the present date, say you have written the date of a cheque as 13th February, that’s when it becomes a post-dated cheque.

This arrangement of issuing post-dated cheques to the recipient (the business or person receiving the payment, also referred to as the payee) is only made when the drawer needs the recipient to wait before depositing the cheque.

Cases When Post-dated Cheques are Used

People generally use post-dated cheques in the following situations.

• If you’d like to assure the supplier of goods or service provider that you’ll clear all their dues after goods are delivered or the service is rendered. In such situations, the final payment may be negotiable depending on the quality of the product or service.

• If you don’t have sufficient funds presently in your account but are sure that your bank account will have sufficient funds at a future date specified on the post-dated cheque.

• Financial institutions use a post-dated cheque as a tool to make sure that borrowers don’t default on the repayment of loans.

Different types of cheques:

Now you understand the post dated cheque meaning clearly.