Which of the following types of cheque protects the holder against the risk of loss?
Answer Details
The type of cheque that protects the holder against the risk of loss is a crossed cheque. A crossed cheque is one that has two parallel lines drawn across it, indicating that the cheque must be paid into a bank account and cannot be cashed over the counter. This type of cheque is a safer payment method because it ensures that the funds are paid directly into the intended recipient's bank account and cannot be lost or stolen like an open or bearer cheque. As a result, crossed cheques are commonly used for high-value transactions or payments to unknown or untrusted parties.