Is a bank cheque safe when selling a car? Ways to pay compared

A bank cheque is safer than a personal cheque, but it isn’t safe until your own bank confirms it has cleared, so never release the car on the strength of the paper. A screenshot of a bank transfer isn’t proof of payment either: the only proof is the full amount sitting in your account, checked in your own banking app.

That rule covers every way a private buyer can pay. What changes is how you confirm the money is real, and how long that takes.

Which payment method is safest for a private car sale?

No method is risk-free, but some are easier to check. NRMA’s advice to private sellers puts cash first, with a bank cheque as the fallback. For a direct transfer, NRMA says to have it sent immediately by PayID and to keep the keys until you’ve confirmed the money is in your account. It also warns sellers to be cautious if a buyer raises PayID too early or pushes crypto, PayPal or Western Union, because scammers often use those tactics.

Here’s how the common options compare.

Whatever you choose, agree it in writing (a text is enough) before the buyer travels. A buyer who changes the method at the last minute, or wants to pay from several different accounts, is giving you a reason to slow down.

Is a bank cheque safer than a personal cheque?

Yes, in one important way. A personal cheque is drawn on the buyer’s own account, so it can be dishonoured if there isn’t enough money in it. A bank cheque is issued by the bank, and NAB’s bank cheque policy says people ask for one because it’s more likely to be paid.

More likely isn’t certain. NAB says a bank cheque shouldn’t be treated as equivalent to cash. It lists cases where it will refuse to pay one, including a forged or altered cheque, one it’s told was stolen or lost, and one it wasn’t paid for issuing. Other banks have their own policies, but a bank cheque can still be dishonoured.

WA ScamNet describes overpayment scammers asking for money back before the seller’s bank has cleared the cheque. Sellers on Australian forums also describe a buyer handing over a bank cheque on a weekend, then reporting it lost or stolen. Those are personal accounts, not published bank policy, but they’re reason enough to treat the paper as a promise until your own bank says the money has cleared.

Cheques are also on the way out. Under the industry’s cheques transition plan, personal, commercial, government and bank cheques can’t be issued after 30 June 2028 and won’t be accepted after 30 September 2029. Some banks have already reduced or withdrawn their cheque services, so check that yours still accepts them before you agree to take one.

How do I check a bank cheque is genuine?

Do this before the car goes, in this order.

1. Plan a weekday handover. Meet during banking hours, so you can contact the issuing bank and get to your own branch on the same day.
2. Go to the bank together if you can. NRMA suggests finishing the sale in person at the buyer’s bank. Watching a teller issue the cheque is one of the strongest checks you can make. Ask for it to be made out to your full name as it appears on your account.
3. Find the bank’s number yourself. Use the bank’s official website. Don’t use a number printed on the cheque or given to you by the buyer, because a forger can print any number they like.
4. Ask the right questions. Give the cheque number, amount, date and payee, and ask whether the bank can confirm it issued the cheque and that it hasn’t been reported lost or stolen. A bank may not confirm details by phone, which is another reason to go in together.
5. Check the details. The payee name, the amount in words and figures, and the date should all match your bill of sale.
6. Deposit it that day, into your own account.
7. Ask your bank when it will clear. Keep the car, keys and papers until your bank confirms it has.

A call to the issuing bank tells you the cheque was issued. It doesn’t tell you the money will reach you, which is why the last two steps matter most.

Is a screenshot of a bank transfer proof of payment?

No. A screenshot shows what was on someone’s screen, not what’s in your account. It can be edited, copied from an old payment, or show a payment that was scheduled and then cancelled. Emailed receipts and texts that look like they’re from a bank or PayID are just as easy to fake. WA Consumer Protection warns sellers about scammers who fake a payment, and says to make sure the money has transferred before you hand over the keys.

Open your banking app the way you always do, never through a link the buyer sends. Australian Payments Plus, which runs PayID, says it never contacts you directly, so any message from PayID asking you to send or receive money is a scam. Our guide to the PayID scam aimed at car sellers shows how that script runs.

What does “cleared funds” actually mean?

In plain terms, money has cleared when it’s in your account, you can use it, and your bank isn’t holding or checking any of it. The timing depends on how the buyer paid.

• PayID and other transfers. Australian Payments Plus says payments to a PayID typically arrive in under a minute, but not always. However the buyer pays, look for a completed transaction in your own app, not a pending one.
• Cheques, including bank cheques. Your account can be credited with a cheque before you can use the money. NAB, for example, says you normally can’t withdraw a deposited cheque until it clears, which generally takes three working days. That gap is exactly what the overpayment scam relies on. Timing varies between banks, so ask yours how long to wait.
• Cash. Notes are yours once they’re in your hand, but they can be fake. Banking them is the real test.

If in doubt, ask your bank whether the payment has cleared and whether any of it is on hold. Until it can confirm both, keep the car.

A Saturday sale, worked through

Here’s how timing can play out, using made-up figures. You agree to sell for $32,000, and the buyer turns up on a Saturday morning holding a bank cheque.

The buyer waits longer than planned, but you never swap the car for a piece of paper you can’t check.

Why would a bank hold a large car payment?

Australian Payments Plus says some payments to a PayID may be held for security purposes, and that banks may set daily limits on account payments, including payments to a PayID. A buyer paying tens of thousands of dollars may need to raise their limit before they come, or pay over two days.

A genuine hold is for the banks to sort out. You never need to pay a fee or click a link to release it, and the car stays with you until the money arrives. If only part lands, count only what’s in your account. If you’re asked to send money yourself, whether it’s a fee, a refund or a payment to someone else, stop. Scamwatch lists requests to pay in unusual ways, including to several different PayIDs or accounts, as a warning sign.

Scamwatch also says to check the account name matches the person you think you’re dealing with, and notes that some banks confirm payee details. Confirmation of Payee, an industry service introduced in July 2025, checks the name, BSB and account number a payer enters against the receiving bank’s records. As the seller, check the name on the incoming payment matches the buyer on your bill of sale, or someone they named before paying.

Is it safe to accept cash for a car?

It can be, and NRMA rates cash as the safest option for private sellers. The risks are fake notes and carrying a large sum around, and both are easier to manage at a bank.

• Meet at a bank. The buyer withdraws the cash at the counter and you deposit it straight away.
• Check the notes. The Reserve Bank’s quick checks start with touch: the note should feel like smooth plastic, slightly rougher where the ink is dark. Then look at the clear window, and on newer notes tilt the note and watch the top corner for a rolling bar of colour.
• Bank it promptly rather than keeping a large sum at home overnight.
• Write it down. Put the amount and “paid in cash” on the bill of sale, and both sign it.

Our guide on whether it’s safe to sell your car for cash covers the wider picture.

When should I hand over the keys and sign the transfer?

Only when the money has cleared. Consumer Affairs Victoria tells sellers not to sign any document that transfers ownership until they’ve received payment, and the NSW Government gives the same advice. Treat the keys, the spare, the service books and the registration papers the same way.

Before the car leaves, check off this list:

• The full agreed amount shows in my own banking app as cleared, not pending.
• The payer’s name matches the buyer on the bill of sale.
• I haven’t sent any money back to the buyer or anyone they named.
• The bill of sale records the price, the payment method and that it was paid in full.
• I have the buyer details my state needs for the notice of disposal.

Then hand over the keys, lodge your notice of disposal (in most states it’s a quick online form the seller completes), and remove the car’s rego from your toll account. Our bill of sale guide shows what to write. The same advice holds when you sell to a business, and our comparison of being paid before pickup or after handover explains what to look for.

Would selling to a licensed dealer take the payment worry away?

It depends on when the dealer pays. When you sell to us, cheques, cash and screenshots don’t come into it.

Sell Your Car Australia is run by Autohaus Australia Pty Ltd, NSW licensed motor dealer MD 077404, ABN 54 618 813 737. We make a genuine offer by phone. If you accept, a deposit is often paid the same day, and the inspection follows at a time and place that suits you. The balance is paid by bank transfer into your account, where you check it yourself, and the car is collected only after you confirm the funds have cleared. No fees come out of the offer, and if there’s finance owing, we deal with your lender directly. As Rahul A put it: “I had an inspection completed, my car sold, with funds cleared in my bank account.”

We buy cars, utes, SUVs and 4WDs 2021 or newer with 100,000 km or less. If yours is older or has more kilometres, send it through anyway and we’ll tell you straight away if we can help. You can read how it works or call 1800 73 55 73 for a free valuation.