Editorial & Advertiser Disclosure Global Banking And Finance Review is an independent publisher which offers News, information, Analysis, Opinion, Press Releases, Reviews, Research reports covering various economies, industries, products, services and companies. The content available on globalbankingandfinance.com is sourced by a mixture of different methods which is not limited to content produced and supplied by various staff writers, journalists, freelancers, individuals, organizations, companies, PR agencies etc. The information available on this website is purely for educational and informational purposes only. We cannot guarantee the accuracy or applicability of any of the information provided at globalbankingandfinance.com with respect to your individual or personal circumstances. Please seek professional advice from a qualified professional before making any financial decisions. Globalbankingandfinance.com also links to various third party websites and we cannot guarantee the accuracy or applicability of the information provided by third party websites.
Links from various articles on our site to third party websites are a mixture of non-sponsored links and sponsored links. Only a very small fraction of the links which point to external websites are affiliate links. Some of the links which you may click on our website may link to various products and services from our partners who may compensate us if you buy a service or product or fill a form or install an app. This will not incur additional cost to you. For avoidance of any doubts and to make it easier, you may consider any links to external websites as sponsored links. Please note that some of the services or products which we talk about carry a high level of risk and may not be suitable for everyone. These may be complex services or products and we request the readers to consider this purely from an educational standpoint. The information provided on this website is general in nature. Global Banking & Finance Review expressly disclaims any liability without any limitation which may arise directly or indirectly from the use of such information.

What is a bank draft?

When you have to receive money from someone, you may get it in the form of a check. The check has your name on it and is given by the person from whom you owe money. You can deposit the check into your bank account and the money will be credited into your account. There is a risk involved in taking a personal check. It is possible that there is no money in the account of the person who has given you the check. In such a case, the check is refused by the bank.

A personal check given by someone can also be rejected by the bank if there is any problem in it, like signature mismatch or an error while writing the check. To avoid all these problems, some people insist on a check given by a bank. This is the bank draft. A bank draft, also known as a banker’s check, is a check that is issued by a bank. Since the bank issues the draft, there is no risk involved and you are sure to get the money in your account when you deposit it.

How to get a draft?

A bank draft is issued by the bank, where you have an account. All you need to do is visit the bank and request a bank draft. The bank would check your account and if you have sufficient funds, they would debit the money from your bank account and issue a draft. The draft can be issued in the name of any person or organization that you specify. The bank may charge you a fee for issuing the draft.

Some banks can issue a bank draft even if you do not have an account with them. You can deposit the cash for the amount for which you need the draft. Additional charges also have to be paid and the bank would issue a draft. To get a draft, you have to fill a form specifying in whose name you want the draft to be prepared.

Nowadays, banks make it convenient for customers to get a draft from their home. You need not even visit the bank; you can login to your bank account online. Once you login, you can order the draft online. All you need to do is specify the amount and the name of the receiver. The charges for issuing the draft would be displayed (no fees are charged from high-value customers). Once you confirm, the amount is debited from your account and the draft would be prepared and mailed to your home or office.

How the draft works?

Most individuals and organizations prefer the bank draft since the payment is backed by the bank. There is no chance of the draft being rejected, as long as you deposit it before the validity ends. Drafts are valid for three or six months and it needs to be deposited within this time. If you receive a bank draft, you can deposit it into your account. The money is transferred immediately (usually within 24 hours).

The bank draft is thus a safe and quick way of receiving money with no risks involved. If you lose a draft or it is damaged, you can get it cancelled. Even if the draft is not used, you can get it cancelled and get back your money.