Ever felt the need to have your cheque with a certain limit?
Suppose you pay around Rs. 1000 every month to your biller Mr. A. The amount is not fixed, but you know that it’ll be around Rs. 1000, or Rs. 1100 at the max.
You can’t frequently meet Mr. A to handover the cheques, and obviously you can’t issue signed blank cheques to him.
In this scenario, wouldn’t it be helpful to you, should you be able to issue post dated blank cheques to Mr. A, the only difference being that all the cheques will be “capped” to Rs. 1100? It means even if you issue signed blank cheques to somebody, he/she won’t be able to write any higher amount than your specified “cap”.
Incidentally, when I discussed this issue with my dad, he recalled some instances where a line e.g. “Under Rs. 51000” used to be printed vertically in red in some government issued cheques, which meant the max amount promised under that cheque was Rs. 51000.
I often felt the need of such kind of cheques while paying my mess bills, providing my brother with his pocket money etc.
Please feel free to share your thoughts and experiences.