Understanding Exchange Acts: Draft, Acceptance, Endorsement, and Aval
Exchange Acts: Key Concepts and Operations
Draft Issue
- It is the act of creating the security.
- Characters: Drawer, Taker, and Drawee.
- “Drawee” exists only in money orders, such as bills of exchange, checks, and duplicates.
Acceptance
- Concept: The act by which the drawee agrees to comply with the payment order given by the drawer.
- It is an act in existing “orders” like bills of exchange, checks, and duplicates.
- There is no acceptance if the title is due at sight.
- There is the “promise to pay” in a promissory
Understanding Current Accounts, Checks, and Deposits
Current Account Basics
Current account: This is an irregular deposit contract, with an additional service agreement provided by the cash custodian.
Irregular deposit: The depositary (receiver) acquires ownership of the deposited item and promises to return to the depositor at the contract’s maturity, either the same item or its equivalent value.
Check Information
Cheque: Mentions in the clauses of this check passed for payment by: Al carrier, on behalf of a particular person with clause <<not
Read MoreSecure Payment Methods in Sales Transactions
In a sale-purchase obligation, the major involved parties (seller-buyer) are obligated as follows: the seller delivers the goods, and the buyer pays the price. Payment can be made as agreed between the parties:
Down Payment
This is a form of immediate delivery, typically in cash (banknotes, legal tender, coins, etc.).
Payment on Credit
This is done at a time or deadline posterior to the goods’ delivery, as agreed upon between the parties. As a rule, the price of the merchandise undergoes a small increase
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