What is the difference between a bankers draft and a cheque

What can you use a cheque or banker's draft for? Cheques and banker's drafts offer a convenient way of making payments from smaller amounts, such as those for household expenses, to making payments for significantly larger amounts, such as for payments of real estate purchases. It enables you to carry little or even no cash around with you; Payments can be made for services where Bank cards are usually not accepted; Issuing a cheque to pay for a small amount is typically less expensive than making a bank transfer; A banker's draft issued by RCB Bank Ltd offers the beneficiary the assurance that RCB Bank Ltd will honour the banker's draft when it is presented for payment; Each RCB Bank Ltd cheque or banker's draft meets the issue standards of the Cyprus Clearing House, featuring several security layers, such as high security paper to reveal any tampering and the use of specialised inks.

A chequebook can be issued for your main current account, or made available through a separate chequing account. Clearing of euro denominated cheques drawn on other local banks, which are members of the Cyprus Clearing House Cheques and banker's drafts drawn on other local banks which are deposited into your account at RCB, clear in standard cases in 3 working days following the date they are presented.

In exceptional cases within 7 working days. The copyrights on the articles and information belong to the National Bank of Canada or other persons. Any reproduction, redistribution, electronic communication, including indirectly via a hyperlink, in whole or in part, of these articles and information and any other use thereof that is not explicitly authorized is prohibited without the prior written consent of the copyright owner.

The contents of this website must not be interpreted, considered or used as if it were financial, legal, fiscal, or other advice. National Bank and its partners in contents will not be liable for any damages that you may incur from such use.

This article is provided by National Bank, its subsidiaries and group entities for information purposes only, and creates no legal or contractual obligation for National Bank, its subsidiaries and group entities. The details of this service offering and the conditions herein are subject to change. The hyperlinks in this article may redirect to external websites not administered by National Bank.

The Bank cannot be held liable for the content of external websites or any damages caused by their use. Views expressed in this article are those of the person being interviewed. They do not necessarily reflect the opinions of National Bank or its subsidiaries.

For financial or business advice, please consult your National Bank advisor, financial planner or an industry professional e. Back to hub. What is a bank draft? Summary What is a bank draft? How do I get a bank draft? Popular Course in this category.

Course Price View Course. Free Investment Banking Course. Login details for this Free course will be emailed to you. Email ID. Contact No. The payer should have an account in the issuing bank and balance the account to cover the amount of the draft.

The certified cheque is issued by a customer who holds an account in the bank and orders the bank to make a payment to the specified person or to the bearer of the cheque. However, there is a certified bank draft which is signed by the bank official which makes it more secure. In case of a bank draft, there are banks representatives who act as an intermediary.

Bank issues draft on your request but processes it only after verifying that the account has sufficient funds to cover the cheque. At this point, the bank deducts the amount from your bank account.

The process is complete once the recipient deposits or cashes the draft. In the case of certified cheque, there is also an intermediary involved which is the bank employee. The bank employee checks if the issuer has sufficient funds in the account. After it is confirmed the employee processes it. The amount is deducted after the employee certifies it. The possible way to stop payment for a bank draft is when it is lost or destroyed.

The bank may provide with a replace issue draft instead. A certified cheque guarantees payment will be made this means it is not possible to stop payment after the certified cheque is issued.