Banking Awareness for Upcoming Exams Set 8 (Cheque)

This set contains banking awareness questions for various upcoming exams like SBI PO, IBPS PO, Clerk and insurance exams. This set contains questions from the topic : Cheque

1. A cheque is defined under which act?
   A) Payment and Settlement Systems Act, 2007
   B) Reserve Bank of India Act, 1934
   C) Banking Regulation Act, 1949
   D) Negotiable Instruments Act, 1881
   
   View Answer

   Option D
   Explanation: A cheque is defined under NI Act 1881
2. A cheque is defined under ____ of Negotiable Instrument Act, 1881
   A) Section 5
   B) Section 6
   C) Section 7
   D) Section 8
   
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   Option B
   Explanation: Section 6 of NI Act 1881
3. A person who signs on the face of the cheque is known as ______
   A) Drawee
   B) Beneficiary
   C) Payee
   D) Drawer
   
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   Option D
   Explanation: Drawer – A person who issues the cheque. He/she will sign the cheque
   Drawee : Bank
   Payee : recipient of the cheque amount.
4. ______ is the process of stopping the flow of the physical cheque issued by a drawer at some point by the presenting bank.
   A) Teleporting
   B) Transport
   C) Elimination
   D) Truncation
   
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   Option D
   Explanation: Truncation is the process of stopping the flow of the physical cheque issued by a drawer at some point by the presenting bank en-route to the paying bank branch. In its place an electronic image of the cheque is transmitted to the paying branch through the clearing house
5. A cheque which is payable to a person whosoever bears it is known as?
   A) Blank Cheque
   B) Bearer Cheque
   C) Order Cheque
   D) Stale Cheque
   
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   Option B
   Explanation: A bearer cheque is one that does not has the word ‘Bearer’ on the cheque cancelled. Whoever carries this cheque to the bank will be paid the amount money mentioned in the cheque.
6. When the word Bearer is cancelled on a cheque the cheque becomes ______ cheque.
   A) Semi Bearer
   B) Stale
   C) Hidden
   D) Order
   
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   Option D
   Explanation: Order Cheque is a cheque whereby the printed word Bearer on the cheque is cancelled.
7. A truncated cheque is one which is ____ .
   A) torn
   B) photocopied
   C) post dated
   D) scanned
   
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   Option D
   Explanation: In CTS, a scanned copy of cheque is used for tnasmission.
8. In a cheque the amount written in in figures(numbers) is called _____ .
   A) Legal Amount
   B) Counting Amount
   C) Courtesy Amount
   D) Numbered Amount
   
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   Option C
   Explanation: Amount in words is known as – legal amount. ; Amount in figures(number) is known as courtesy amount
9. A cheque with data written on it 01-02-2017 is presented in a bank on 05-02-2017. This cheque is an example of _____.
   A) Post-dated cheque
   B) Ante-dated cheque
   C) Stale cheque
   D) None of these
   
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   Option B
   Explanation: When a cheque bears a date with is earlier than the date on which it is presented in a bank it is known as Ante-dated cheque.
   Similarly when a cheque bearing a date which is yet to come, is presented in a bank it is known as Post-dated cheque
10. Which of the following is a process in which a cheque is transferred to a name of another person by signing on the cheque along with the name of person to whom cheque is being transferred is known as?
    A) Truncation
    B) Endorsement
    C) Restriction
    D) Transfer
    
    View Answer

    Option B