PAP: Payable at par or MCC:
Multi-city cheques
What is it: PAP
or MCC cheques can be encashed anywhere in India, irrespective of the city they
were issued in. They are treated as local clearing cheques across the country.
The amount is credited in the account the same day and there are no inter-city
collection charges associated with a normal cheques being encashed in another
city.
A cheque issued at a branch in
Chennai, can be encashed at a branch in Dibrugarh as if it were a local cheque.
There would be a notation on the top
or the bottom of a cheque indicating its status as as PAP or MCC cheque.
When do you need it:
By issuing a PAP or MCC cheque, you can save demand draft or cheque clearing
costs.
Usually, these cheques are issued by companies
to disburse dividends or redemption amounts
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