Sign up for our newsletter. Your bank draft is irrevocable as soon as you hand it over in payment. If you need to send a large amount to someone in another country, e-transfers are another good option for sending funds anywhere in the world. That means that if the person you give the bank draft to loses and then finds it again, they can still deposit it, at your expense, even if you gave them a replacement bank draft.
It may be possible to trace the bank draft and buy back the non-negotiable part under certain conditions. If you change your mind and decide not to make the purchase or if the seller cancels the sale, you can get a refund on your bank draft. All you need to do is bring both parts of the draft to your financial institution.
To make sure the document you have in your hands is the real deal, contact the financial institution that issued the draft. All in all, bank drafts are a handy payment method for making large purchases. Of course, there are other secure forms of payment in use these days, such as Interac e-Transfers.
Find a National Bank location near you. Interac e-Transfer is a registered trademark of Interac Corp. Any reproduction, in whole or in part, is strictly prohibited without the prior written consent of National Bank of Canada.
The articles and information on this website are protected by the copyright laws in effect in Canada or other countries, as applicable. The copyrights on the articles and information belong to the National Bank of Canada or other persons. However, money orders might not be an acceptable form of payment, so ask the recipient first. Thousands of credit union locations participate in shared branching.
The term bank draft can also refer to automatic electronic payments. These payments allow businesses and service providers to transfer funds directly out of a customer's checking account. Instead of writing a check or paying with debit and credit cards, customers provide bank account information account and routing numbers , specifically to the business to set up draft payments. These transfers typically happen through the Automated Clearing House ACH network, and they make it convenient for customers to make recurring or one-time payments.
Businesses can start offering payment by bank draft by setting up a merchant account or partnering with a payment processor that accepts ACH payments. These payments are typically less expensive for merchants than credit card payments as little as a few cents each , and less prone to chargebacks. You should be able to cancel automatic bank drafts with either your bank or the entity drafting money from your account, but your bank will have the most control over whether the payment goes through or not.
The Consumer Financial Protection Bureau recommends requesting that your bank stop automatic payments at least three business days before the next scheduled transaction. This request can be given in person, by phone, or in writing. A convertible bank draft can be converted into another currency other than your domestic currency. That makes them useful for people who need to use bank drafts abroad. TD Newsroom. Accessed May 18, Bank for International Settlements.
Help With My Bank. Federal Trade Commission. Capital One. Consumer Financial Protection Bureau. If you want to know more information about automated international payments and foreign currency drafts you should speak to your bank. There is also useful information relating to this on the Pay Your Way website at www. The comfort they provide is that they will not be returned unpaid i. This is because they are drawn on the account of the actual bank itself and are paid for in advance by the person or business that has requested it.
Therefore, you should still wait until the end of the sixth working day to be certain the money is yours. Bankers' Drafts. What are bankers' drafts?
How can I get a banker's draft? Policies on international drafts vary, so customers who want to transfer money this way should contact their bank directly with any questions. The person requesting the draft usually makes the request in his or her local currency, which is converted to that of the payee when the draft is issued.
In many cases, an international bank draft must be deposited into a bank account and cannot be submitted for cash. Additional fees may be involved when international bank drafts are purchased and deposited. One main advantage of using this form of payment is that it usually clears much more quickly than a personal check, often in the same amount of time it takes a local check to be cleared.
Sending the draft by certified mail with a tracking number can help to ensure safe delivery. Many companies now accept what are sometimes known as automatic bank drafts ABDs , in which money is taken out of the payer's account electronically at regular times. Also known as an automatic payment, automatic bill pay, and other terms, this type of draft differs in that no paper check is ever issued.
This type of draft is most often used to pay for utilities, mortgage , insurance, and other important bills. A bank draft, cashier's check , and certified check are similarly guaranteed methods of payment, but do have some slight differences. The main distinction between these three types of payment are when the money is transferred and who is issuing the check.
Cashier's checks are very similar to bank drafts, and in many cases are considered the same thing. Rather than being issued from the bank's home office or main branch, however, a cashier's check may be written from the particular branch where it is requested.
It may also be signed by the cashier or another official at the bank, rather than the manager.
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