Everybody's Guide to Money Matters / With a description of the various investments chiefly dealt in on the stock exchange, and the mode of dealing therein - of Exeter F.S.A. William Cotton

It then appears as follows:-

The cheque is detached from the counterfoil at the dotted line, and is retained by the cashier, who hands over £10 to the lady together with the book containing the remaining cheques.

"Oh! I had quite forgotten - I owe Miss Tucker, the milliner, £23 10s. Will the cashier please to let me have £23 10s. to pay her with."

Miss Smith is told that there is no need of incurring the risk of carrying the money through the streets, as a cheque in favour of Miss Tucker will equally answer the purpose; and again he fills up the blank spaces in a second cheque, which appears thus:-

————————————————————————————- | No. 10902. | No. 10902. ! ! __March_I,_ 1898 | | | ! ! | | March I, 1898 | To the Blank!hir! Banking Company, | | | !Bla!ktown. | | | ! ! order J.S. | | _Miss_Tucker_ | Pay to ___Miss_Tucker______ or ====== | | | ! ! | | | the sum of _Twenty-three_pounds_10/-_ | | | ! ! | | £23_10/-_____ | £23_10/-____! ! __Jane_Smith__ | | | ! ! | ————————————————————————————-

"You see," says the cashier, "I have struck out the word 'bearer' and substituted the word 'order.' This will oblige Miss Tucker to sign her name on the back of the cheque (technically, to 'endorse it') before it can be paid. Your initials are required to confirm the alteration.* I have also drawn parallel lines across the cheque, which makes it what is termed 'a crossed cheque,' and a crossed cheque cannot be cashed direct, but must be paid into an account at a bank. So you see you will have the signature of Miss Tucker, proving that she has been paid her bill by means of this cheque; and it is obvious that by crossing the cheque, should it be lost and made an improper use of, there would be no difficulty in tracing through whose hands it passed."

(* Banks also issue cheques with the word "order" printed instead of "bearer.")

Miss Smith soon learns that all her trades- men's bills may be paid in the same way, with- out going to the bank to draw the money, and with the advantage that the cheque is not only a proof of payment, but that she has also a record of her accounts in the bank pass-book.

It may here be mentioned that should a banker cash a cheque with a forged endorsement, he is not responsible, and the loss falls on the drawer of the cheque.* The crossing of a cheque, how- ever, necessitating its being paid to a bank account, would facilitate the discovery of the culprit. An additional security is given to a crossed cheque if it bears the words "not nego- tiable" written underneath the crossing. This means that it cannot legally be used as a means of payment to a third party. In the event of such a cheque going wrong, the loss would fall upon a bank negotiating it for a customer. The bank could be called upon to make good the amount to the payee.