Processing cheques manually is been done for decades and more efficient systems are still under research. In this entire processing system, providing a secured transaction with efficient verification is what more important. An instance cheque clearance system is proposed comprising of an unmanned customer and an operator station, and means for providing communication with secure transaction. The customer station includes an OMR scanner to scan a given cheque and a cash dispenser to withdraw the cash. Secure means are provided for enabling the operator to verify the identity of the cheque bearer by recognizing MICR number, Cheque number, Signature and amount through various techniques. This will be later implemented through MATLAB[Matrix Laboratory]. OCR[Optical Character Recognition] is a method of verifying the cheque number,amount and the MICR [Magnetic Ink Character Recognition] number. Our main aim is to detect whether the cheque is valid or not by verifying the signature and account payee which can be validated using binarization .For customer the signature is fed into the process in which the original images are resized to a specified size and there images are converted to binary values which will be compared with the original signature stored in the bank database. A secret pin number is given by the cheque bearer to check drawer for a secure transaction. The validation process is done using java. This pin number is generated from a kit where the secret number for each cheque is has been saved in a PIC microcontroller as well as the bank database. A keypad is connected to an LCD [Liquid Crystal Display] to which the user can type the cheque number and view its corresponding PIN number in the display. Once the PIN number is verified in the cheque station then the amount can be withdrawn or transacted at the same moment by the user.