Bill of Exchange

What & Why

Bill

of Exchange Negotiable instrument

Need:

Facilitate regular flow of cash either immediately or after certain period of time.

Documents

for making payments, the ownership of which can be transferred.

Definition :

Bill of exchange is an instrument in writing containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money only to, or to the order of, a certain person or to the bearer of the instrument. A post dated cheque.

Example :

Parties involved
Three

parties are involved:

Drawer Drawee Payee

Specimen copy

Features of Bill of Exchange

A bill It It

of exchange must be in writing.

must be dated must contain an order to pay a certain sum of money. be unconditional.

The order must The parties

to a bill must be certain.

Thank you.