Economics · Banking Instruments
Why is a Bank Draft generally preferred over a standard cheque for large financial transactions?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1It is issued by a bank guaranteeing payment, making it much safer from default✓
- 2It can be transferred easily multiple times without endorsement
- 3It does not require any processing or clearance time by the clearinghouse
- 4It can be cancelled at any time by the drawer without penalty
Correct answer
It is issued by a bank guaranteeing payment, making it much safer from default
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