0
yes
Wiki User
∙ 11y ago
Add your answer:
Earn +20 pts
What does account payee mean?
payee is the person whom the cheque, draft or money order is made out to.
What is the difference between demand draft and crossed demand draft?
Explanation 1:A Demand Draft is a banking instrument . In any case, if it is not crossed, it is bearer, meaning thereby that the bearer, anyone who is presenting it to the bank can get it en cashed . However, if we cross it, it is two parallel lines on the DD's top left, it becomes crossed . It means that the benefit of that DD can be taken only after getting it credited to the addressee's account only. By crossing the bearer ship goes, so the one who has signed the cheque or given the DD is very sure that it goes to the particular person and the particular person can be traced because it first went to his/her account . That is why a crossed draft is also chalked "Account payee only".Explanation 2:If you cross a bank draft only an account holder can en cash the same. It is generally safer than the normal bank draft.Assume you take a draft for 100 dollars in favour of Mr. ABCD. If you don't cross it, Mr. ABCD can en cash it without having a bank account. However if you cross it the money will go only to a bank account. So at any point of time you can prove that you had indeed paid to Mr. ABCD. Another added benefit is in case the draft is lost, any body with the same name can claim the cash.Thus you get two benefits : Added security as well as a proof.Q: Can a draft not issued as cross by the issuing bank be crossed later?A: Yes. Under Section 125 of the NEGOTIABLE INSTRUMENTS ACT, 1881, a holder may cross it.Further more, such holder may cross generally, specially and also add words "not negotiable".A demand draft is always an order instrument. The definition of a demand draft under Section 85A of the Indian Negotiable Instrument Act, 1881, makes it clear that a demand draft is an order instrument. In view of this, issue of a demand draft payable to a bearer is STRICTLY PROHIBITED under Section 31 of the Reserve Bank of India Act. If a demand draft is made payable to a bearer it becomes like a currency note and In India only RBI is empowered to issue a currency note. Hence a DD is always made payable to order of a person and no DD is issued payable to bearer.Crossing is an indication to the banker that it should be paid only through a banker. In other words, cash will not be paid across the counter. The payment will be made through an account of the payee. The main purpose of a crossing is to ensure that the amount of the cheque is paid to the correct payee or endoresee and thus helps in preventing payment to a wrongful person. Thus the purpose of crossing is to ensure safety of the amount. It thus prevents wrongful persons from getting the amout of the cheque.IF the demand draft is not crossed, payment will be made by the banker subject to proper identification of the payee. If the DD is crossed, the amount of the DD will be credited to the beneficiary's acccount.
What is the difference between cross demand draft and account payee demand draft?
A Demand Draft is a banking instrument . In any case, if it is not crossed, it is bearer, meaning thereby that the bearer, anyone who is presenting it to the bank can get it en cashed . However, if we cross it, it is two parallel lines on the DD's top left, it becomes crossed . It means that the benefit of that DD can be taken only after getting it credited to the addressee's account only. By crossing the bearer ship goes, so the one who has signed the cheque or given the DD is very sure that it goes to the particular person and the particular person can be traced because it first went to his/her account . That is why a crossed draft is also chalked "Account payee only". Explanation 2: If you cross a bank draft only an account holder can en cash the same. It is generally safer than the normal bank draft. Assume you take a draft for 100 dollars in favour of Mr. ABCD. If you don't cross it, Mr. ABCD can en cash it without having a bank account. However if you cross it the money will go only to a bank account. So at any point of time you can prove that you had indeed paid to Mr. ABCD. Another added benefit is in case the draft is lost, any body with the same name can claim the cash. Thus you get two benefits : Added security as well as a proof.
What is the difference between a crossed cheque and account payee's cheque?
They both mean the same
Show step by step details on demand draft?
Demand Draft is a special form of Bill of Exchange.Its an open drft written insrument containing an unconditional order signed by the authorized official of the issuing branch directing the paying branch to pay the sum of money noted in the draft to the payee named in the draft,or to order.
Can a payment by demand draft be stopped by the payee?
A Demand Draft can be cancelled at the same branch from where it was issued. The applicant needs to provide a letter along with the original Demand Draft for cancellation.
What does account payee mean?
payee is the person whom the cheque, draft or money order is made out to.
Can Demand Draft be dishonoured?
A Demand Draft is a cheque that contains an order of one branch of a bank ( Drawer branch ) directing another branch of the same bank ( Drawee branch ) to pay on demand a certain sum of money to a specified beneficiary ( Payee ) . It is an Account payee instrument, meaning it can only be credited to the account of the payee and cannot be encashed over the counter by the payee.A Demand Draft is a much safer and certain method of payment than cheques, since in the case of cheques, an individual is the drawer and hence the cheque can be dishonoured by the drawee bank due to insufficiency of funds in the drawer's account. But since in the case of a DD, the drawer is a bank, payment is certain and it cannot be dishonoured.
What is the difference between demand draft and crossed demand draft?
Explanation 1:A Demand Draft is a banking instrument . In any case, if it is not crossed, it is bearer, meaning thereby that the bearer, anyone who is presenting it to the bank can get it en cashed . However, if we cross it, it is two parallel lines on the DD's top left, it becomes crossed . It means that the benefit of that DD can be taken only after getting it credited to the addressee's account only. By crossing the bearer ship goes, so the one who has signed the cheque or given the DD is very sure that it goes to the particular person and the particular person can be traced because it first went to his/her account . That is why a crossed draft is also chalked "Account payee only".Explanation 2:If you cross a bank draft only an account holder can en cash the same. It is generally safer than the normal bank draft.Assume you take a draft for 100 dollars in favour of Mr. ABCD. If you don't cross it, Mr. ABCD can en cash it without having a bank account. However if you cross it the money will go only to a bank account. So at any point of time you can prove that you had indeed paid to Mr. ABCD. Another added benefit is in case the draft is lost, any body with the same name can claim the cash.Thus you get two benefits : Added security as well as a proof.Q: Can a draft not issued as cross by the issuing bank be crossed later?A: Yes. Under Section 125 of the NEGOTIABLE INSTRUMENTS ACT, 1881, a holder may cross it.Further more, such holder may cross generally, specially and also add words "not negotiable".A demand draft is always an order instrument. The definition of a demand draft under Section 85A of the Indian Negotiable Instrument Act, 1881, makes it clear that a demand draft is an order instrument. In view of this, issue of a demand draft payable to a bearer is STRICTLY PROHIBITED under Section 31 of the Reserve Bank of India Act. If a demand draft is made payable to a bearer it becomes like a currency note and In India only RBI is empowered to issue a currency note. Hence a DD is always made payable to order of a person and no DD is issued payable to bearer.Crossing is an indication to the banker that it should be paid only through a banker. In other words, cash will not be paid across the counter. The payment will be made through an account of the payee. The main purpose of a crossing is to ensure that the amount of the cheque is paid to the correct payee or endoresee and thus helps in preventing payment to a wrongful person. Thus the purpose of crossing is to ensure safety of the amount. It thus prevents wrongful persons from getting the amout of the cheque.IF the demand draft is not crossed, payment will be made by the banker subject to proper identification of the payee. If the DD is crossed, the amount of the DD will be credited to the beneficiary's acccount.
What is the difference between cross demand draft and account payee demand draft?
A Demand Draft is a banking instrument . In any case, if it is not crossed, it is bearer, meaning thereby that the bearer, anyone who is presenting it to the bank can get it en cashed . However, if we cross it, it is two parallel lines on the DD's top left, it becomes crossed . It means that the benefit of that DD can be taken only after getting it credited to the addressee's account only. By crossing the bearer ship goes, so the one who has signed the cheque or given the DD is very sure that it goes to the particular person and the particular person can be traced because it first went to his/her account . That is why a crossed draft is also chalked "Account payee only". Explanation 2: If you cross a bank draft only an account holder can en cash the same. It is generally safer than the normal bank draft. Assume you take a draft for 100 dollars in favour of Mr. ABCD. If you don't cross it, Mr. ABCD can en cash it without having a bank account. However if you cross it the money will go only to a bank account. So at any point of time you can prove that you had indeed paid to Mr. ABCD. Another added benefit is in case the draft is lost, any body with the same name can claim the cash. Thus you get two benefits : Added security as well as a proof.
What is the difference between a crossed cheque and account payee's cheque?
They both mean the same
Difference between crossed check and account payee check?
Actually they both refer to the same. A crossed cheque is also called an account payee cheque. These types of cheques can only be deposited into an individuals bank account and will not be cashed over the counter. This is used to minimize misuse of cheque instruments in case of loss or theft. We can always track the destination account into which funds were deposited using our crossed cheque whereas in case of bearer cheques (the ones that aren't crossed and can be cashed over the counter) we cannot.
Can stop payment of demand draft is possible in India?
To stop demand draft is difficult. A payee can only issue a complaint if draft is lost or destroyed. The issuer bank can then submit a lost or stop payment against the draft and will often re-issue a new one.
Who is in charge of the draft?
Payee
Show you the sample of demand draft with demand draft number?
I'm unable to show images as I am a text-based assistant. However, a demand draft typically includes the DD number at the top right corner of the document, along with details such as the issuing bank's name and branch, payee details, date, and the amount specified. The DD number serves as a unique identifier for the transaction.
What is the instruction to the bank on a crossed bank?
IF you meant 'on a crossed cheque' - it's an instruction to the bank, to credit the value of the cheque to the payee's account - rather than handing over the cash.
Which act in India defines Demand-Draft?
There is no definite section that defines demand draft. "The Demand Draft is a pre-paid Negotiable Instrument, wherein the drawee bank undertakes to make payment in full when the instrument is presented by the payee for payment. ". Hence Negotiable Instrument Act 1881 covers demand draft.Source : rbidocs.rbi.org.in/rdocs/Publications/DOCs/4453.doc
