BILL OF EXCHANGE ESSENTIALS

by • 17/06/2011 • 2nd year BankingComments (0)260

Definition: A bill of exchange is “an unconditional order in writing, addressed by one person to another, signed by the person to whom it is addressed to pay on demand or at a fixed or determinable future time, a sum certain in money to or to the order of a specified person or to the bearer.

Essentials of a Bill

  • Bill of exchange must be in writing.
  • It must be an order, not a request or promise.
  • The order must be unconditional.
  • It must be for a specific amount in money, not in barter.
  • The bill must be payable to a certain person or his order.
  • It must be addressed to a specific person.
  • The bill is payable at a certain date or on demand.
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