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KembaraXtra- Financial Terms- account payee only refers to words printed between two vertical lines on a UK cheque that make the cheque non-transferable.
This wording is used in accordance with the Cheque Act 1992 to ensure that the cheque can only be paid into the bank account of the named payee.
The purpose of marking a cheque “account payee only” is to reduce the risk of fraud, unauthorized endorsement, or transfer of the cheque to another person.
Many cheques also include the wording “A/C payee” or “not negotiable” for additional protection and restriction on transferability.
Although the restriction improves security, banks may sometimes argue that they acted in good faith and without negligence if an endorsed cheque is accepted under certain circumstances.
This wording is used in accordance with the Cheque Act 1992 to ensure that the cheque can only be paid into the bank account of the named payee.
The purpose of marking a cheque “account payee only” is to reduce the risk of fraud, unauthorized endorsement, or transfer of the cheque to another person.
Many cheques also include the wording “A/C payee” or “not negotiable” for additional protection and restriction on transferability.
Although the restriction improves security, banks may sometimes argue that they acted in good faith and without negligence if an endorsed cheque is accepted under certain circumstances.
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