BANKING GENERAL KNOWLEDGE
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
letter from the bank
|
|
|
cheque which a bank draws itself
|
|
|
Instruction to a banker to collect a customer’s debt.
|
|
|
Instruction not to honour a stop payment
|
Detailed explanation-1: -A bank draft is a negotiable instrument where payment is guaranteed by the issuing bank. Banks verify and withdraw funds from the requester’s account and deposit them into an internal account to cover the amount of the draft. A seller may require a bank draft when they have no relationship with the buyer.
Detailed explanation-2: -It’s a paper document that looks a lot like a regular cheque. The main difference is that someone who receives a bank draft has a guarantee that the funds are available, as opposed to a regular cheque, which could bounce. Bank drafts are made out to the person receiving the money.
Detailed explanation-3: -Definition of a banker’s cheque To put simply, the bank issues this type of cheque on your behalf, which is drawn from its own funds; whilst the customer pays the bank the amount either as cash or allows the bank to debit the corresponding amount from its account.
Detailed explanation-4: –The maker of a bill of exchange or cheque is called the “drawer”; the person thereby directed to pay is called the “drawee”.