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Published September 21, 2022

How to Read a Cheque

Know how to read a cheque so that you can find and verify your personal information, cheque amount, and transit, institution, routing and account numbers.

As technology has advanced and online banking has become more popular, writing personal cheques has declined in favour of direct deposits, wire transfers and electronic funds transfers.

Cheques, however, remain in use and it’s helpful to understand how to read a cheque, even if you typically do your banking online.

Reading the main parts of a cheque

A cheque is divided up into multiple parts. Each section is important and contains details about the account holder and their account.

Personal information on a cheque

In the top left corner of the cheque, you’ll find information about the authorized user or users of the account from which the cheque will withdraw money.

  • The top line is your full name associated with your bank account.
  • The second line is your home street address.
  • The third line is your city, province and postal code.

Personalised cheques already have this information written out. Some cheques — like starter or temporary cheques — may require the user to write out the information themselves.

Bank information on a cheque

At the bottom of the cheque, you will notice a series of groups of numbers, known as your bank account and routing numbers. Note that the first number at the bottom left is the number of the cheque (it’s three digits). The numbers that follow are your banking information.

There are three important banking numbers that are found on a cheque.

  1. Your transit number. This is the five-digit number that follows the cheque number when you read the cheque from left to right. The transit number indicates the branch of a financial institution at which you opened your account.
  2. Your institution number. This is a three-digit number and follows the transit number. Your institution number is a unique code assigned to each bank or financial institution to identify them. Note that your transit number plus your institution number is sometimes referred to as a “routing number.”
  3. Your account number. This number will be at least seven digits, but could be up to 12 depending on your banking institution. The account number refers to which specific bank account the money from the cheque will be withdrawn from.

Other things to notice when reading a cheque

Any personal and banking information found on your cheque should be the same on every single cheque you write. The other information on the cheque, however, will change.

This includes:

  • The number of the cheque, which as mentioned above, is three digits and can be found in the bottom left corner, as well as the top right corner.
  • The date, which will be below the cheque number on the top right corner.
  • The payee. Your cheque will have a line with the words “pay to the order of” in front of it. This is where you write the company or individual’s name by whom the cheque can be cashed or deposited.
  • The payment amount, which is written out in full words. For example: “One hundred and eighty-seven dollars.” Beside that, in a small box the amount is written again, in numerals. So, using our example, $187.00.

Why it’s important to know how to read a cheque

Though cheques are increasingly less popular, they are by no means obsolete. Some businesses and people may prefer to receive cheques and they are a good way to send money via the post if the need should ever arise.

It’s also worth noting that some financial institutions in Canada may treat cheques that are older than six months as invalid. Check the date of any cheque you receive (or find in the back of a drawer) to be sure you can cash or deposit it.

Additionally, the banking numbers located on the bottom of the cheque are what you’ll need to to set up direct deposits or automatic payments from your banking accounts.

There are other places to find this information, such as the bank’s website or your latest bank statement, but looking at a cheque is an easy way to find it all in one place.

About the Author

Sandra MacGregor

Sandra MacGregor has been writing about personal finance, investing and credit cards for over a decade. Her work has appeared in a variety of publications like the New York Times, the UK Telegraph, the Washington Post, Forbes.com and the Toronto Star. You can follow her on Twitter at @MacgregorWrites.

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