![]() Builds trust between the seller and the buyer.A useful mode of payment in international transactions.There are several pros of using a bill of exchange, along with a few disadvantages. (Click here to learn about different types of bill of exchange). A bill of exchange is usually used in the international business transactions where two unknown parties are getting involved in a business deal. It contains the order of transfer of money to a specific person on a predetermined date in the future. The different time zone can cause a delay in the transfer.Ī bill of exchange is a legal document.Can take 3 or more days to make the transfer.Money can be transferred overseas in less time.Ĭons of Using telegraphic transfer or mail transfer.Useful mode of payment in an emergency.This mode of payment if quite fast as compared to the previous mode of payment.Īlso Read Reflective Practice - Meaning, Importance and Steps Pros of using telegraphic transfer or mail transfer. This mode of payment is popular among traders and merchants who do the business of thousands every day. More chances of fraudulent cases as cheques might get rejected by the bank due to insufficient balance in the payer’s bank account.Not all merchants accept cheques as a mode of payment, which can cause a problem if you are in an unknown country.Not convenient for merchants and individuals who make several days to day transactions.The payer can cancel the payment until payee has presented the cheque to the bank.A cheque is crossed, which reduces the chances of payment to the wrong person.This mode of payment also has different pros and cons. There are different types of cheques, such as Bearer Cheque, Crossed cheque, Stale cheque, Order Cheque, Open Cheque, Self Cheque, Post-dated cheque, Banker’s cheque, etc. A checkbook is given to a person when he opens an account in a bank. ![]() The cheque is considered one of the safest mode of payment as one does not have to carry a large sum of money all around. A cheque can be defined as an order to a bank to pay the stated amount of money on the cheque from a person’s account to the person whose name is mentioned on the cheque. It is difficult to make a large number of payments using cash.Īnother commonly used mode of payment is cheque.One needs to carry the currency of the country where he wants to make a transaction.People in day-to-day transactions frequently use this mode of payment.Īlso Read Top 10 Effective Organization Tips Cons of Payment using cash: The buyer makes the decided amount of payment using currency notes or coins to the seller to receive goods and services produced by the seller and as an acknowledgment seller provides a valid receipt of the bill. This mode of payment has been used by the traders since ancient times, and this mode of payment is still preferred by old age or less technology-savvy people. This is the simplest and commonly used mode of payment all around the world. Cons of Using telegraphic transfer or mail transfer.Pros of using telegraphic transfer or mail transfer.
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