Front office management I

Payment through Cheque

1. 
   Most of the hotels do not consider the personal cheques as a very acceptable method of payment because of the problem of cheque burning.
   
2. 
   Although a hotel has no legal obligation to accept, they cannot refuse the payment through cheques on the basis of illegal reasons.
   
3. 
   Now a day’s most of the hotels require cheque guarantee cards for accepting the personal cheques.
   

The cheque guarantee cards
A cheque guarantee card was essentially an abbreviated portable letter of credit granted by a bank to a qualified depositor in the form of a plastic card that was used in conjunction with a cheque. This allowed retailers to accept cheques and providing that the retailer wrote the card number on the back of the cheque, it was signed in the retailer's presence, and the retailer verified the signature on the cheque against the signature on the card, then the cheque could not be stopped and payment

could not be refused by the bank. This arrangement worked only for cheques drawn on an account provided by the bank that issued the card and could result in an overdraft with penalty interest.

1. 
   The cheque guarantee cards guarantee payment upto the agreed amount usually between Rs. 5,000/- to Rs.50,000/-
   
2. 
   Only one cheque is issued per transaction.
   
3. 
   It is signed in presence of the cashier.
   
4. 
   The bank code of the cheque & the guarantee cards should agree.
   
5. 
   The card nos is written on the reverse side of the cheque.
   
6. 
   The card should not be expired.
   

Second & third party cheques
These cheques are not accepted by the hotel.

1. 
   In general the second party cheque is made out to the guest presenting the cheque.
   
2. 
   A third party cheque is a cheque made out to someone who has in turn signed the cheque over to the guest presenting it.