Cheques, drafts, pay orders and banker’s cheques issued by banks in India are generally valid for how many months from the date of the instrument?

Introduction / Context:
Banking awareness is a key component of many competitive exams, especially those related to finance and banking jobs. One important detail is the validity period of negotiable instruments such as cheques, drafts, pay orders and banker’s cheques. The Reserve Bank of India has prescribed a standard validity period, after which these instruments become stale and are normally not honoured by banks. This question asks for the duration, in months, for which such instruments are considered valid from the date they are drawn.

Given Data / Assumptions:

• The instruments mentioned are cheques, drafts, pay orders and banker’s cheques.
• We are asked about their general validity period counted from the date of issue.
• Options provided are 4 months, 1 month, 6 months, and 3 months.
• Standard RBI guidelines applicable in India are assumed.

Concept / Approach:
The Reserve Bank of India has clarified that cheques, drafts, pay orders and banker’s cheques are normally valid for three months from the date mentioned on the instrument. Earlier, longer validity periods were common, but RBI guidelines shortened them to three months to reduce the risk of fraud and misuse. After this period, such instruments are termed "stale" and are not usually paid by banks without revalidation. Therefore, among the given options, three months from the date of the instrument is the correct validity period.

Step-by-Step Solution:

Verification / Alternative check:
To verify, recall that many bank forms and instructions clearly state that cheques are "valid for three months only" from the date of issue. Bank staff are trained to treat cheques presented after this period as stale. Exam preparation books on banking awareness also emphasise this reduced validity period, making three months a very familiar figure to banking aspirants.

Why Other Options Are Wrong:

• 4 months from the date: Not consistent with the current RBI guideline, which sets three months as the standard period.
• 1 month from the date: Too short and not supported by RBI's general policy for these instruments.
• 6 months from the date: This was a common validity period historically in some contexts, but RBI has specifically reduced it to three months, so six months is now outdated.

Common Pitfalls:
Some candidates may remember older practices or informal statements suggesting longer validity and thus incorrectly choose six months. Others may mix up the three month period with different timelines for other banking processes, such as fixed deposit interest calculations or account dormancy rules. To avoid these errors, it is useful to create a simple note that states: "Cheques, drafts, pay orders and banker’s cheques – validity three months from date of instrument." This precise wording helps cement the correct period in your memory.

Final Answer:
Cheques, drafts, pay orders and banker’s cheques are generally valid for 3 months from the date of the instrument.