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Bank Draft

2020-11-24

Bank draft is a negotiable instrument issued by the drawer bank to the payer who has handed over the fund to the drawer bank, so that the payer can handle the settlement or withdraw cash in other places. It applies to the settlement of corporate and personal customers for the remittance and transfer of funds. The drawer bank is the drawee of a bank draft, its agent shall be the bank which examines and pays the amount on a negotiable instrument on behalf of it or contracting office of a different bank.

Notes for business handling:

A bank draft can be used to transfer the fund, and the one marked “cash” can be used to withdraw the cash.

Any company who is the applicant or the payer cannot apply for a cash bank draft. 

All bank drafts must be ordered and can be endorsed. 

The time limit on the presentation for payment of a bank draft shall be one month starting from the date of draft.

The bank does not accept the loss reporting and stop payment for any bank draft without a designated agent that is lost, only a moral assistance instead. 

Where the applicant requests refund because the time limit for presentment for payment of the bank draft has passed or for other reasons, it shall submit the advice of settlement to the original drawer bank to handle the refund. Where the applicant requests refund due to the failure to provide the advice of settlement, it shall handle the refund at the bank at least one month (namely, two month after the date of draft) after the time limit for presentment for payment expires. Where the applicant requests refund due to the loss of the bank draft, shall handle the refund on the strength of valid certification produced by the people's court one month after the time limit for presentment for payment expires.