Different Modes or Types of Payment ↓
The payment tin last made inward 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 1 of the oldest modes of payment. In this case, the buyer pays money inward the shape of notes too coins to the seller. The seller on receipt of cash, issues cash memo or cash receipt. This means of payment is suitable solely for small-scale transactions.
2. Telegraphic Transfer or Mail Transfer
In this system, the payer deposits the money along alongside other charges inward a depository fiscal establishment which has a branch share at the payee's place. On receipt of cash too other charges, the depository fiscal establishment telegraphically informs the branch share to credit the amount to the payee's A/C. The payee is accordingly informed too tin withdraw the money. The money tin too last remitted yesteryear postal service transfers, which takes a footling longer time. This method helps for quick remittance, only it is non a pop one.
3. Money Order or Postal Order
Payment tin too last remitted through money orders too postal orders. Businessmen may prefer to a greater extent than of postal orders because a large number of postal orders tin last collected too encashed at a time. Postal gild is safer than a money order. Postal orders tin last crossed for security purpose. However, traders usually exercise non utilization this method of payment.
4. Bill of Exchange
According to the Section v of Indian Negotiable Instruments Act, 1881, "A mouth of telephone substitution is an musical instrument inward writing containing an unconditional order, signed yesteryear the maker, directing a sure enough individual to pay a sure enough amount of money solely to, or to the gild of, a sure enough individual to the bearer of the instrument."
Some Advantages of Bill of Exchange are :-
- The holder of the mouth tin have the money fifty-fifty earlier the due appointment of bill, by
discounting the mouth alongside his bank. - The mouth tin last transferred to approximately other person.
- It enables the buyer to purchase the goods without making actual payment. He possess got the mouth & brand payment at a afterwards date.
5. Promissory Note
A promissory annotation is an musical instrument inward writing (not beingness a depository fiscal establishment annotation or e currency note) containing an unconditional task signed yesteryear the maker, to pay a sure enough amount of money solely to, or to the gild of a sure enough person, or to the bearer of the instrument.
6. Cheque
Every human being of affairs has a depository fiscal establishment concern human relationship to facilitate his concern transactions. When the depository fiscal establishment concern human relationship is opened, the depository fiscal establishment gives a depository fiscal establishment gibe majority for making payments. blogspot.com//search?q=what-is-cheque-definition-kinds-and">cheque payment is a convenient too safer means of payment. To ensure blogspot.com//search?q=what-is-cheque-definition-kinds-and">safety the depository fiscal establishment gibe may last blogspot.com//search?q=what-is-cheque-definition-kinds-and">crossed to a greater extent than frequently than non or specially, too thence that the payment to a incorrect individual is prevented.
7. Bank Draft
A blogspot.com//search?q=what-is-cheque-definition-kinds-and">Bank Draft is defined equally "An gild to pay money, drawn yesteryear 1 share of a depository fiscal establishment upon approximately other share of the same depository fiscal establishment for a amount of money payable to gild on demand."
Bank drafts are frequently used for the utilization of transferring funds from 1 house to approximately other inside a the world or from 1 the world to another.
A depository fiscal establishment draft is an gild given yesteryear 1 depository fiscal establishment upon approximately other of its branch depository fiscal establishment situated elsewhere to pay a sure enough amount of money.
The contents of depository fiscal establishment draft is to a greater extent than or less that of a cheque, only it is signed non yesteryear the payer only yesteryear the banker.
