SBI Cheque Bounced — Charges, Reasons & What to Do

A bounced cheque (also called "dishonoured cheque" or "returned cheque") can result in penalty charges, damage to your banking record, and even legal action under Section 138 of the Negotiable Instruments Act. This guide explains why SBI cheques bounce, what it costs, and what to do next.

Disclaimer: CitizenNest is an independent informational platform and is not affiliated with SBI or any government body. Charges mentioned are indicative — confirm current rates with your branch.

Common Reasons for SBI Cheque Bounce

SBI Cheque Bounce Charges (2024-25)

Charges for Cheque Issuer (Your Cheque Bounces)

Charges for Cheque Depositor (Cheque You Received Bounces)

Charges are approximate and subject to revision. Check SBI's schedule of charges for the latest rates.

Note: These charges are debited automatically from your account by SBI.

What to Do If Your SBI Cheque Bounces

If You Issued the Cheque (Drawer)

1. Check the reason — SBI sends a "Cheque Return Memo" stating why it bounced
2. If insufficient funds:
   • Deposit enough money into your account immediately
   • Contact the payee (person you issued the cheque to) and request them to re-present the cheque
   • Or issue a fresh cheque / make payment via NEFT/UPI
3. If signature mismatch:
   • Visit your branch and verify your specimen signature on file
   • Update your signature if needed (requires branch visit with ID proof)
   • Issue a new cheque with the correct signature
4. If overwriting: Issue a new, clean cheque without any corrections
5. Pay the bounce charges — SBI will auto-debit from your account

Warning: Under Section 138 of the Negotiable Instruments Act, if a cheque bounces due to insufficient funds and the payee sends you a legal notice, you must pay within 15 days. Failure can lead to criminal prosecution with up to 2 years imprisonment and/or fine up to twice the cheque amount.

If You Deposited a Cheque That Bounced (Payee)

1. SBI will return the cheque with a Cheque Return Memo stating the reason
2. You can ask the issuer to re-present the cheque (a cheque can be presented twice before it's finally returned)
3. If the cheque bounced due to insufficient funds, you have legal recourse:
   • Send a legal notice to the cheque issuer within 30 days of receiving the return memo
   • The issuer gets 15 days to make the payment
   • If they don't pay, file a complaint under Section 138 in a magistrate court within 30 days of the 15-day deadline expiring
4. For other reasons (signature mismatch, stale cheque), ask the issuer for a fresh cheque

Legal Implications of Cheque Bounce

Section 138 — Negotiable Instruments Act, 1881

This section applies when:

• The cheque was issued for a legally enforceable debt
• It bounced due to insufficient funds or account closed
• The payee presented it within the cheque's validity period (3 months)

Legal process:

1. Payee sends demand notice to drawer within 30 days of bounce
2. Drawer must pay within 15 days of receiving the notice
3. If unpaid, payee files criminal complaint within 30 days
4. Court can impose: Up to 2 years imprisonment and/or fine up to twice the cheque amount

Note: Cheque bounce due to signature mismatch, stop payment, or stale cheque does NOT attract Section 138 prosecution.

How to Avoid Cheque Bounce

1. Check your balance before issuing a cheque — ensure sufficient funds including any minimum balance requirement
2. Sign carefully — match your specimen signature exactly as registered with the bank
3. Don't overwrite — if you make a mistake, issue a new cheque leaf
4. Write clearly — ensure amount in words and figures match, date is correct, and payee name is clear
5. Issue post-dated cheques carefully — ensure funds will be available on the date mentioned
6. Track issued cheques — note cheque numbers and amounts in your register
7. Set up SMS alerts for account debits to monitor your balance

How to Reissue a Cheque After Bounce

1. Ensure the reason for bounce is resolved (sufficient funds, correct signature, etc.)
2. Issue a fresh cheque from a new cheque leaf — don't reuse the bounced one
3. Write the current date (the old bounced cheque cannot be re-presented by you)
4. The payee can also re-present the original bounced cheque once more if it's still within the validity period (3 months)
5. If you've run out of cheque leaves, request a new chequebook via:
   • YONO app → Service Requests → Cheque Book Request
   • Internet Banking → e-Services → Cheque Book Request
   • SMS: Send CHQ <Account Number> to 567676

Important Tips

1. Cheque bounce affects your CIBIL score — repeated bounces can lower your credit rating and impact loan eligibility
2. Keep a buffer amount in your account beyond the cheque value to cover any fees
3. For large payments, consider NEFT/RTGS/UPI instead of cheques — they're instant and avoid bounce risk
4. If someone threatens you with a bounced cheque case, consult a lawyer — you have legal rights and timelines to respond
5. SBI maintains a record of cheque bounces — frequent offenders may face account restrictions

Frequently Asked Questions

How many times can a bounced cheque be re-presented?

A bounced cheque can be re-presented up to 2 times (total 3 presentations including the first). After that, the bank won't accept it.

Does cheque bounce affect CIBIL score?

Yes. Cheque bounces, especially due to insufficient funds, are reported to CIBIL and can negatively impact your credit score.

Can I stop payment on a cheque I've already issued?

Yes. Log in to SBI Internet Banking → e-Services → Stop Payment, or visit your branch. However, if the cheque was issued for a legally enforceable debt, stopping payment can still attract Section 138 prosecution.

What is a Cheque Return Memo?

It's an official document issued by the bank when a cheque is dishonoured. It states the reason for return and is important evidence if legal action is taken.

Is there a time limit to deposit a cheque?

Yes. A cheque is valid for 3 months from the date written on it. After that, it becomes stale and the bank will not process it.

Can I issue a cheque if my account has insufficient funds?

Technically you can write the cheque, but if it bounces due to insufficient funds, you'll face penalty charges and potential legal action under Section 138.

Are cheque bounce charges refundable?

No. Once SBI debits cheque return charges from your account, they are not refundable.