Different Modes or Types of Payment ↓
The payment tin live on made inwards many different ways similar yesteryear giving Cash, doing Telegraphic Transfer or Mail Transfer, via Money Order or Postal Order, Bill of Exchange, Promissory Note, Cheque, Bank Draft, etc.
1. Cash Payment
This is ane of the oldest modes of payment. In this case, the buyer pays money inwards the cast of notes in addition to coins to the seller. The seller on receipt of cash, issues cash memo or cash receipt. This agency of payment is suitable alone for minor transactions.
2. Telegraphic Transfer or Mail Transfer
In this system, the payer deposits the money along alongside other charges inwards a banking corporation which has a branch purpose at the payee's place. On receipt of cash in addition to other charges, the banking corporation telegraphically informs the branch purpose to credit the amount to the payee's A/C. The payee is accordingly informed in addition to tin withdraw the money. The money tin besides live on remitted yesteryear postal service transfers, which takes a trivial longer time. This method helps for quick remittance, exactly it is non a pop one.
3. Money Order or Postal Order
Payment tin besides live on remitted through money orders in addition to postal orders. Businessmen may prefer to a greater extent than of postal orders because a large number of postal orders tin live on collected in addition to encashed at a time. Postal club is safer than a money order. Postal orders tin live on crossed for security purpose. However, traders ordinarily practise non utilization this method of payment.
4. Bill of Exchange
According to the Section five of Indian Negotiable Instruments Act, 1881, "A neb of telephone substitution is an musical instrument inwards writing containing an unconditional order, signed yesteryear the maker, directing a for sure mortal to pay a for sure amount of money alone to, or to the club of, a for sure mortal to the bearer of the instrument."
Some Advantages of Bill of Exchange are :-
- The holder of the neb tin have the money fifty-fifty earlier the due appointment of bill, by
discounting the neb alongside his bank. - The neb tin live on transferred to closed to other person.
- It enables the buyer to purchase the goods without making actual payment. He bring the neb & brand payment at a later on date.
5. Promissory Note
A promissory annotation is an musical instrument inwards writing (not existence a banking corporation annotation or e currency note) containing an unconditional task signed yesteryear the maker, to pay a for sure amount of money alone to, or to the club of a for sure person, or to the bearer of the instrument.
6. Cheque
Every homo of affairs has a banking corporation line organisation human relationship to facilitate his line organisation transactions. When the banking corporation line organisation human relationship is opened, the banking corporation gives a banking corporation represent mass for making payments. cheque payment is a convenient in addition to safer agency of payment. To ensure safety the banking corporation represent may live on crossed to a greater extent than oft than non or specially, in addition to therefore that the payment to a incorrect mortal is prevented.
7. Bank Draft
A Bank Draft is defined equally "An club to pay money, drawn yesteryear ane purpose of a banking corporation upon closed to other purpose of the same banking corporation for a amount of money payable to club on demand."
Bank drafts are oft used for the purpose of transferring funds from ane house to closed to other inside a province or from ane province to another.
A banking corporation draft is an club given yesteryear ane banking corporation upon closed to other of its branch banking corporation situated elsewhere to pay a for sure amount of money.
The contents of banking corporation draft is to a greater extent than or less that of a cheque, exactly it is signed non yesteryear the payer exactly yesteryear the banker.
