During the first century A.D., banks in the Persia (Iran) and other territories in Persian empire under Sassanid dynasty issued letters of credit known as Sakks. They are considered the basis for the modern cheque.

The cheque had its origins in the ancient banking system, in which bankers would issue orders at the request of their customers, to pay money to identified payees. Such an order was referred to as a bill of exchange. The use of bills of exchange facilitated trade by eliminating the need for merchants to carry large quantities of currency (e.g. gold) to purchase goods and services. A draft is a bill of exchange which is payable on demand of the payee.

The cheque was originally called a "check" in reference to the counterfoil used to check against forgery and alterations. The spelling "cheque" seems to have been introduced by J. W. Gilbart in 1828 (A practical treatise on banking, 2nd ed, 1828, Effingham Wilson, London). He explains in a footnote 'Most writers spell it check. I have adopted the above form because it is free from ambiguity and is analogous to the ex-chequer, the royal treasury. It is also used by the Bank of England "Cheque Office"'. According to Holden, the older spelling survived in some English text-books in the 1920s (M J Holden, History of Negotiable Instruments in English Law, 1955, University of London Press, London).

The older spelling is more common in the USA, but the UK and most Commonwealth countries have adopted the newer form "cheque".

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