We issue checks in respect of payments made to vendors for supply of household items, for payment of electricity and telephone bills, for transferring money from one account to another and so on. Every check has a validity period within which the check should be deposited/encashed by the beneficiary.

Payer is required to mention information such as payee name, amount in words and figures on the face of the check along with check issuance date. Further, money will get transferred from the payer’s account only if the check contains a valid signature. In case relevant information is not available on the check, it is quite possible that the check will be dishonored by the bank.

It is very important for the payer to issue check with correct details. All the information mentioned on the check should be legible and readable.

What is the Meaning of Post Dating A Check?

Payer is required to mention the date on which the check is issued on the top of the check. This date should ideally be the current date. In many cases, payer enters a future date on the check. For Instance, an individual has issued a check to his/her sister on 1st September 2011. However, date is mentioned as 10th September 2011. Mentioning a future date on the face of the check is known as postdating a check.

What is the Purpose of Postdating A Check?

In many cases, an individual may not have sufficient balance in his/her bank account. However, he/she may expect to receive funds in the near future. In order to ensure that a check is not deposited/encashed by the beneficiary before the expected day of arrival of funds in the bank account, payer issues a post dated check. For Instance, an individual has $ 1,500 in his/her bank account on 15th September 2011. This individual has to transfer an amount of $ 3,500 to his/her brother. Salary of $ 4,000 is expected to be credited on 25th September 2011. In order to ensure that the check is deposited by his/her brother after 25th September 2011; individual may issue a check with a date of 27th September 2011.

How Postdating A Check Actually Works?

In many countries, postdating a check may require the payer to notify his/her bank that payment in respect of a post dated check is to be released only on or after the date mentioned on the check. Otherwise, banks may have an option to release the payment whenever check is presented for payment by the beneficiary. In some cases, there is a possibility that banks may dishonor a check with a future date. This can result in a penalty on both the payer and the payee.

Rules for acceptance of postdated checks by different banks may vary from country to country and from state to state. Hence, it becomes important for both the payer and the payee to understand check acceptance rules of their respective banks. It is advisable for the payer to notify the payee that check has been issued with a future date and should be presented for payment only after obtaining a confirmation from the payer.