Bounced Cheques and Unpaid Items

A bounced cheque is a personal cheque that returns to your creditor unpaid due to insufficient funds in your current account. There are usually charges to pay if this occurs, which will vary from financial institution to financial institution. Often, the charge will be standard for any unpaid transaction, although some banks will waive the charge if the account holder has no history of failed payments.

Unpaid items are items that an account holder has charged to their account, but sufficient credit to honour the transaction is unavailable. If the transaction is refused it is said to 'return unpaid' and there is usually a fee for any transactions that do so. These operate in the same way as a bounced cheque, but apply to debit card, direct debit and other forms of electronic transaction. If you make a series of payments when there are insufficient funds in your account, the bank or building society which provides your current account may freeze the account and contact you to discuss this matter. Failing to make payments may also have an adverse effect on your credit rating.