Banking · Ancillary Services and RBI Guidelines
A Demand Draft is reported lost by the purchaser before it is delivered to the payee. Which of the following represents the correct legal and procedural stance that the issuing bank must take according to Reserve Bank of India (RBI) guidelines?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The bank must wait for the original draft to expire after its validity period before considering any request for duplicate issuance.
- 2The bank is legally prohibited from issuing a duplicate draft once the original has been handed over to the purchaser.
- 3The bank can issue a duplicate draft after receiving a non-payment advice from the drawee branch and obtaining an indemnity bond from the purchaser.✓
- 4The bank must immediately issue a duplicate draft without any conditions because the purchaser remains the legal owner.
Correct answer
The bank can issue a duplicate draft after receiving a non-payment advice from the drawee branch and obtaining an indemnity bond from the purchaser.
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