When you apply for a business loan, you will need to give the lender a cancelled cheque. This acts as an important piece of documentation, helping lenders assess your financial history and reduce the instances of typographical errors.
In addition to business loans, lenders require blank cheques to verify your financial information and do customer KYC in the following instances:
- When you open another bank account
- When you buy a new insurance policy
- When you withdraw from your Employee Provident Fund
If you do not have a chequebook, or you have run out of blank cheques, it could delay your business loan approval and disbursal. This is becuase your bank may take a few days (or weeks) to get you a new chequebook.
So, our advice is to make sure you have a chequebook with blank cheques before you apply for the business loan you need to grow.