Payment instruments


A cheque is a written order to NAB to pay a sum of money on demand. Some of NAB's banking services provide cheque access. If you have cheque access, the following features apply.

Drawing a cheque

When you write out a cheque, it must be completed properly and with care to avoid fraudulent alteration, and be signed in accordance with the signing authority you have given NAB.

When signing a cheque you must: provide your full signature against each alteration you make; and date the cheque on the date it was signed; and complete all details.

When NAB receives your cheque for payment: it is deemed to be a request by you to NAB to withdraw funds from your account for the amount shown on the cheque; it is an authority to pay those funds to the payee of the cheque or to the payee's bank; and if there are not enough cleared funds in your account, NAB may dishonour or pay the cheque at its discretion.


Generally it will take 3 working days from the time you deposit the cheque until the proceeds are available as cleared funds in your account.

The steps involved in clearing a cheque are usually: you deposit a cheque you have received into your NAB account; we will seek payment of the cheque from the bank on which the cheque is drawn; and the bank will pay the proceeds of the cheque to your NAB account. Only after the completion of these steps will the cheque be cleared.

Normally you will not be able to withdraw the value of a cheque you deposit until the cheque is cleared, even though your account will be immediately credited with the proceeds of the cheque. This rule applies even to cheques made payable to 'cash'.

Special clearance

If you want fast clearance of a cheque you can ask your branch for a special clearance. Our staff will provide you with an estimate of the time it will take plus the cost involved.

NAB's fee for a special clearance covers the extra administrative costs involved in making a special payment request to the bank where the cheque account is held. Depending on the speed of the clearance you request, this added cost may in some instances include courier expenses. Special clearance fees are outlined in NAB's Personal and Business Banking brochures entitled 'A Guide to Fees and Charges'. These brochures are available on request or through NAB's website

Effect of crossing

If you cross a cheque (by drawing two parallel lines from top to bottom across the front of the cheque), you are telling NAB not to cash it over the counter. The cheque therefore must be paid to a bank (e.g. into a customer's account). If NAB does cash a crossed cheque, it may be liable for any loss suffered by the true owner.

Meaning of 'not negotiable'

You may write the words 'not negotiable' between the two parallel lines on your cheque. This means that if the cheque is transferred to another person, the person who obtains the cheque has no greater rights to it than the person who gave it.

For example, if the cheque was stolen, the person from whom the cheque was stolen might recover the amount of the cheque from the person who received payment, even though that person who received it may have done nothing wrong.

Meaning of 'account payee only'

You may also write 'account payee only' between the two parallel lines on your cheque. These words mean that you direct a bank that is accepting the cheque to pay the amount only to the account of the person named in the cheque. The bank is put on notice to make enquiries if a person other than the payee tries to pay the cheque into his or her own account, or tries to cash the cheque.

NAB may be liable to the true owner of the cheque if it negligently pays the proceeds of the cheque to a person other than the payee. The words 'account payee only' do not prevent the transfer of a cheque.

Significance of deleting 'or bearer'

Cheques are generally printed with the words 'or bearer' appearing at the end of the line on which you put the name of the person to be paid.

The words 'or bearer' mean that the bank on which the cheque is drawn is entitled to pay the cheque to the person in possession of the cheque, even if that person found it or stole it, unless the bank has reason to suspect that the cheque has fallen into the wrong hands.

If you wish to alter this position, the simplest way to do this is to cross out the words 'or bearer'. This will make the cheque an 'order' cheque. Where the cheque is an 'order' cheque, the bank on which the cheque is drawn must only pay the cheque to the person named as payee or to a person to whom the cheque has been endorsed.

Stop payment

You may stop payment of your cheque before it has been presented for payment by calling 13 22 65 for personal customers or 13 10 12 from 8am-8pm Mon-Fri, or 9am-6pm on weekends (AEST/AEDT) for business customers.

If you have access to NAB Internet Banking or NAB Telephone Banking, you can give us a stop payment instruction 24 hours a day, 7 days a week. Alternatively, you may notify any branch of NAB, either in person or by phone.

No matter how you choose to notify NAB it is important to tell us quickly if you want to stop payment. If you advise us by telephone, we will stop payment of the cheque (assuming the cheque has not already been presented for payment) and may also seek your written confirmation.

It is important to clearly identify the cheque by providing: the account name and number; the cheque number and amount; the date of the cheque; and to whom the cheque is payable.

NAB may charge a fee for stopping payment on a cheque and we will advise you of this fee at the time you request NAB to stop payment on it. The fee is also outlined in NAB's Personal and Business Banking brochures entitled 'A Guide to Fees and Charges'. These brochures are available on request or through NAB's website

Unauthorised alteration of your cheques

When you write a cheque, you should take care to reduce the opportunity for forgery and fraud.

When writing a cheque: do not leave gaps between the words or figures; begin the amount in words as close as possible to the left hand side; begin the amount in figures as close as possible to the dollar sign ($); never use pencil or ink that can be rubbed out; never sign a cheque before it is used or filled out; and always write the amount in words because words are harder to alter.

Dishonouring cheques

Your cheque may (at NAB's discretion), be returned unpaid or 'dishonoured' by NAB in certain circumstances. These include: there are not enough available funds in your account to cover the amount of the cheque; there is some irregularity with your cheque, for example it is unsigned, is more than 15 months old, is post-dated (i.e. the cheque bears a date that has not arrived), or has been materially altered (e.g. by a change to the amount originally stated on it) and you may not have provided your full signature against the alteration; you have instructed NAB to stop payment of your cheque; or NAB has received notice of your mental incapacity or of your death.

NAB may charge a fee for dishonouring your cheque. The fee is also outlined in NAB's Personal and Business Banking brochures entitled 'A Guide to Fees and Charges'. These brochures are available on request or through NAB's website

Third party cheques

When a cheque is presented for payment into the account of, or to, a person other than the nominated payee it is called a third party cheque.

Whether the cheque is open or crossed, NAB will carefully establish whether the bearer is entitled to hold the cheque. If we pay an unauthorised person, NAB may be liable to the drawer or true owner, unless we have acted in good faith and without negligence. If it is an 'order' cheque, it must be endorsed by the payee on the reverse side.

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