Who are the parties to a cheque?

(A) Drawer

(B) Payee

(C) Acceptor

(D) Holder

Choose the correct answer from the following options:

Correct option is B

· Drawer (A) – True: The drawer is the person who issues (writes) the cheque.
· Payee (B) – True: The payee is the person to whom the cheque is payable.
· Acceptor (C) – False: The term "acceptor" applies to bills of exchange, not cheques.
· Holder (D) – True: The holder is the person in possession of the cheque, typically the payee or an endorsee.
Information Booster:
1. Key Parties to a Cheque:
· Drawer: The account holder who writes the cheque.
· Payee: The person to whom the payment is made.
· Holder: Any person who legally possesses the cheque.
2. Parties Not Applicable to Cheques:
· The acceptor (common in bills of exchange) is not involved in a cheque as there is no requirement for acceptance.
Additional Knowledge:
1. What is a Cheque?
· A cheque is a negotiable instrument directing a bank to pay a specific amount from the drawer's account to the payee.
2. Endorsement and Holder in Due Course:
· The payee can endorse the cheque to another person, making them the holder in due course.