GK
BANKING AWARENESS AND SEBI
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
negotiable instrument
|
|
|
not negotiable instrument
|
|
|
not transferable instrument
|
|
|
quasi-negotiable instrument
|
Detailed explanation-1: -A demand draft, also called a remotely created check (RCC), is a negotiable instrument to transfer funds from one bank to another. It is issued by a bank to a client (drawer) in order to direct a different bank or another branch of the same bank (drawee) to pay the specified amount of money to the payee.
Detailed explanation-2: -Demand Draft also known as DD is a type of pre-paid negotiable instrument in which a drawee bank usually becomes a guarantor in order to make full payment when this instrument is presented. A unique feature of Demand Draft is that it cannot be dishonored as the payment is made beforehand.
Detailed explanation-3: -The UCC defines a negotiable instrument as an unconditioned writing that promises or orders the payment of a fixed amount of money. Drafts and notes are the two categories of instruments.