Question
Download Solution PDFWhat is the revised validity period of cheques as per RBI guidelines effective from April 1, 2012?
Answer (Detailed Solution Below)
Detailed Solution
Download Solution PDFThe correct answer is 3 months.
In News
- RBI revised the validity period of Cheques, Demand Drafts, Pay Orders, and Banker’s Cheques from 6 months to 3 months effective April 1, 2012.
- The validity period is counted from the date of issue of the instrument.
Key Points
- Validity of cheque-related instruments reduced to 3 months as per RBI directive.
- This applies to Cheques, Demand Drafts, Pay Orders, and Banker’s Cheques.
- Previously, the validity period was 6 months before the revision.
- Instruments presented after the validity period may be dishonored by banks.
- The revision aims to reduce fraud and increase transaction security.
Additional Information
- Demand Drafts (DD)
- Prepaid negotiable instruments used for transferring money.
- Pay Orders & Banker’s Cheques
- Bank-issued payment instruments similar to demand drafts.
- Also subject to the 3-month validity rule.
- Cheque Dishonor
- Cheques presented after expiry may be returned unpaid by the bank.
- Fraud Prevention
- Shortening validity helps reduce the risk of stale cheque frauds.
Last updated on Jul 10, 2025
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