cashier's check

What is a Bank Draft?

A bank draft is a payment order written by a financial institution and payable on demand. Bank drafts are also known as bank checks or cashiers checks. Bank drafts are similar to a personal check, except they are issued by a financial institution instead of an individual person. Bank drafts guarantee payment of the amount printed on the instrument, as long as the issuer has the funds in their account.

Advantages of Bank Drafts

Bank drafts are one of the best and most secure ways to make a large payment, such as a down payment on a car, a business loan, or a large purchase. Bank drafts offer several advantages:

1. Safety: Bank drafts are one of the safest ways to make a large payment. The issuing bank guarantees payment, so the recipient does not have to worry about whether or not you have the funds available for the payment.

2. Speed: Bank drafts are much faster than using cash or a personal check. The whole process is completed quickly and you can have a bank draft the same day you request it.

3. Convenience: Bank drafts are convenient because they are accepted in many places. You can use them to make payments anywhere you can use a personal check.

Disadvantages of Bank Drafts

Despite the safety and speed of bank drafts, there are also some disadvantages.

1. Cost: Bank drafts can be expensive depending on where you go to get them. Some banks charge a flat fee for a bank draft, while others may charge a percentage of the amount.

2. Limited Availability: Bank drafts may not be available in all locations. You may have to go to a specific location to get one, such as a bank.

3. Security: While bank drafts are safe, they are not foolproof. You should be aware of the possibility of fraud or theft. Make sure the recipient has the security measures in place to protect the bank draft, such as storing it in a secure location.

Overall, bank drafts offer many advantages and are a secure way to make a large payment. Be sure to weigh the pros and cons before deciding if a bank draft is right for you.

简单介绍

Bank draft, also known as Bill of Exchange, is a negotiable instrument issued by financial institutions, usually banks and some securities companies or Trust companies. It is not a discharge of debt, but a written order of one party to another party to pay for exchange goods or pay money. The payer entrusts the bank and issues a bill to the payee. After the payee confirms the bill, he can go to the counter of the issuing bank and apply for cash.

The bank draft is usually issued on behalf of the customer and guaranteed by the bank. Generally speaking, the bank is obligated to pay the payee in full according to the content of the bill; and the payer is only responsible for the payment of the remaining part of the bill after the bank pays the bill. The bank draft has the advantages of fast speed, convenient application, strong credibility and high safety.

In China, The Issuance of a bank draft requires the following documents: 1.Application for bank draft issuance, with the name and address of the payer and payee, the amount of the bank draft, the purpose of payment, etc. 2.Payment voucher: documents or vouchers as evidence of the payers source of payment or validity of the payment . 3.Proof of identity: Documents such as identity cards and business licenses.

In short, Bank draft is a written order of one party to another party to pay for exchange goods or pay money. It has the advantages of fast speed, convenient application, strong credibility and high safety. Therefore, the bank draft is widely used in the sites where the collection and payment of goods and services are used.