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Difference between Pay Order and Demand Draft

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Demand drafts are used when one person wants to send or transfer money (remit) to another person who is in another city. The person wanting to send money, deposits cash in a bank or issue a cheque in favour of the issuing bank, which issues him a demand draft. The demand draft is sent to the person who is to receive the money. The receiver gives it to the branch/bank where he holds an account and receives the payment. They are valid for 6 months. Banks normally charge a commission for issuing demand drafts.

Payment orders or Banker’s Cheques are similar to demand drafts but are usually issued for payments within a city. These are usually valid for 3 months. Banks may charge a commission for issuing Payment Orders and Banker’s Cheques.( INFORMATION POSTED FROM RBI WEBSITE )

Posted by bharathkandasamy (not verified) on Mon, 09/22/2014 - 14:19
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Amazing words used..Very Simple to Understand..Basic :)

Posted by Gurpreet Kaur Maan (not verified) on Thu, 05/29/2014 - 21:59