What is a Cashier's Cheque

A form of payment method that has a bank guarantee is a cashier's cheque.

It is also known by various other names such as bank cheque, teller's cheque, treasurer's cheque, or official cheque.

The buyer must pay the full amount of the cheque upfront together with any fees in order to receive a cashier's cheque.

The bank then confirms that there are sufficient funds in the buyer's account and reserves the necessary sum to cover the cheque.

The buyer can then use the cashier's cheque to pay the beneficiary after it is issued by the bank.

When a sizable sum of money is needed for a particular reason, such as a down payment on a home or car, cashier's cheques are frequently used.

Since they are insured by the bank and are irrevocable once issued, they are seen as a more secure form of payment than a personal check.

A cashier's cheque is different from a usual cheque in several ways:

1.     Guarantee: A cashier's cheque is guaranteed by the bank that issues it. This means that the bank guarantees the payment of the cheque, and the recipient can be assured that the funds will be available when they deposit the cheque.

2.     Payment: A cashier's cheque is paid for upfront by the purchaser. This means that the funds for the cheque are immediately deducted from the purchaser's account and set aside to cover the cheque.

3.     Security: A cashier's cheque is considered to be a more secure form of payment than a usual cheque because it cannot bounce or be stopped once it is issued. This is because the bank has already set aside the funds to cover the cheque.

4.     Limits: Cashier's cheques are typically used for large transactions, whereas usual cheques are used for smaller transactions. Additionally, banks often have limits on the amount of a cashier's cheque that can be issued, which varies depending on the bank's policies and the number of funds available in the purchaser's account.

In general, a cashier's cheque is a safer and more reliable form of payment than a standard cheque, which makes it handy in circumstances where a sizable sum of money is needed.