If someone writes down a bill of exchange and has it stamped and signed by the person who holds it, it is also a tradable tool. It tells the bank to give the person who owns this document a certain amount of money on demand or within a certain amount of time. For these to be valid, the debtor must agree to them. They are generally payments for goods and services. These things are some of the things that it has.
- It needs to have the right date on it.
- possesses an order of payment
- It is required that the drawer or maker sign it.
- A drawee must agree to accept the bill.
- The amount and order of payment should be made clear.
It needs to be sent to the right receiver.
The following three people are involved:
Drawer: The person who issued the document and gets the money.
Drawee: The person or thing that needs to pay the amount.
Payee: The payee is the person who gets paid, and this person is usually the same as the drawer.
- Documentary Bill: This type consists of a bill of exchange backed by pertinent documents that attest to the authenticity of the transaction or sale between the purchaser and vendor.
- Demand bill: Demand bills are due and payable at the time they are demanded. Due to the absence of a specified payment due date, the account must be settled at the time it is presented.
- Usage Bill: This type of bill is time-bound, requiring payment to be received and processed within the specified period and timeframe.
- Inland Bill: An inland bill is exclusively remittable within a single country and not in any other foreign jurisdiction. This bill is the antithesis of the foreign bill.
- Clean Bill: In the absence of any substantiating documentation, this bill carries a relatively higher interest rate in comparison to the other bills.
- Foreign Bill: A foreign bill refers to a bill that is eligible for payment outside of India. An import bill and an export bill are both instances of a foreign bill.
- Accommodation Bill: An accommodation bill is a bill that is sponsored, drawn, and adopted without any stipulations.
- Trade Bill: This type of bill is exclusively associated with trade.
- Supply Bill: The invoice that the government department receives back from the supplier or contractor is referred to as the supply bill.
