Parties To A Cheque Or Parties Involved In A Cheque

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There are three parties involved in a cheque. They are as follows

1. Drawer

Drawer is the party who draws the cheque upon a specified banker. He is the maker of the cheque. He is the account holder who draws the cheque for drawing money from his bank account. He is the person who issues cheque directing the bank to pay a certain sum of money to a certain person or to the bearer. Thus, the person who signs the cheque is known as drawer.

2. Drawee
Drawee is the party upon whom the cheque is drawn. Drawee is the bank. It is the party to whom the drawer gives order to pay the amount to the person named on the cheque or his order to the bearer. When the bank follows the order and pays the amount of the cheque then the cheque is said to be honored. In case of refusal of the order, the cheque is said to be dishonored.

3. Payee
Payee is the party who presents the cheque for payment. He is the person who receives money from bank. He is the party in favor of whom cheque is issued. The payee is the person whose name is mentioned on the cheque. If the cheque is made payable to self, the drawer himself becomes the payee.

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  1. thnxs it helps me lot of much

  2. Replies
    1. Its wonderful, thanks alot

  3. This is the best explanation I have ever got about the parties of a cheque. This is very helpful. Thanks a lot.

  4. What happens if the cheque is made Account Payee only to Mr A. But Mr A passes the cheque to to Mr B who cashes it? Or what if Mr B also passes the cheque on to Mr C who cashes it. ie. cashed by one or two other parties other than the named Account payee only.


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