Up to 2 Years in Jail for Cheque Bounce: What You Need to Know
Check Bounce: Checks often bounce for various reasons. Many people think it's a small mistake, but the consequences can be pretty serious. Let's find out what the law says about this.
Financial Transactions
If your check bounces, you have 15 days to pay after a legal notice. If not, you could face two years in jail or a hefty fine under Section 138 of the NI Act.
Immediate Penalty
When a check bounces, banks charge you ₹250 to ₹750 before any legal action. Failed EMIs or card payments also get extra fees, adding up to thousands in losses.
Impact on Credit Score
Missing an EMI or credit card payment doesn't just mean fines. It can drop your credit score by 50-70 points, making future loans or credit cards harder to get.
Due to Repeated Bounces..
One bounced check might not be a big deal, but repeated failures hurt your credit score. This makes it tough to get future loans, especially home loans, at good rates.
Only a Bounced Check is a Crime
Under Section 138, a bounced check is a crime, but a failed auto-debit isn't. Still, it can cost you money, so be careful with both checks and auto-debits.
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