bankers draft how does it work

jockettuk

been seeing more and more people putting this on there auctions

How does it work as never had to send or use one before is it just transfering money from one bank account to another and if so can you do this from your online bank for instance

just wondering as i know one day im going to get one and dont want to look stupid then lol

thanks

alwaysonthego_2

What are Bankers' Drafts?
Bankers' drafts are cheques drawn directly on the account of a bank rather than the account of a customer. The comfort they provide is that it is highly unlikely they would be returned unpaid due to lack of funds. However it is important to note that there is no guarantee against fraudulent use — for example, they may be lost or stolen and then used fraudulently.

http://www.apacs.org.uk/payment_options/cheques_draft.html


They are probably not the best way to pay or to be paid by though

Dave_Brooker

jockettuk wrote: »

been seeing more and more people putting this on there auctions

How does it work as never had to send or use one before is it just transfering money from one bank account to another and if so can you do this from your online bank for instance

just wondering as i know one day im going to get one and dont want to look stupid then lol

thanks

That's just a defult setting for when you want postal orders, you end up with postal orders/bankers drafts.

If you ever sell something valuable it's worth getting the draft checked as there are plenty of fake ones doing the rounds...

soolin

There is no point at all to using a bankers draft, just as alwaysonthego says they have to clear through a bank account anyway just like any other cheque. There is still a mistaken impression though that they are as safe as cash, which they are not.

Soo

Cute_'n'_Quirky

Soolin you are incorrect.

They are as safe as cash or a postal order and are free - I get mine from the Halifax

A banker's draft cannot bounce Soolin and you DO NOT need to wait for them to clear.

The money is taken from the drawer's account as soon as the draft is issued, hence it cannot bounce.

It cannot be fraudulently used either, since it is made out to the payee and it is crossed, therefore it MUST be paid into a cheque account.

Ask at your bank/building society for the reality.

mah_jong

jockettuk wrote: »

been seeing more and more people putting this on there auctions

Are these auctiva hosted ? I have just started a trial with them and to get Postal orders as MOP you have to have bankers draft.

At least thats the way it appeared with me

soolin

Cute_n_Quirky wrote: »

Soolin you are incorrect.

They are as safe as cash or a postal order and are free - I get mine from the Halifax

A banker's draft cannot bounce Soolin and you DO NOT need to wait for them to clear.

The money is taken from the drawer's account as soon as the draft is issued, hence it cannot bounce.

It cannot be fraudulently used either, since it is made out to the payee and it is crossed, therefore it MUST be paid into a cheque account.

Ask at your bank/building society for the reality.

I take it you didn't read the link posted by alwaysonthego then?

Also, read this taken from the British bankers Association:
http://www.bba.org.uk/bba/jsp/polopoly.jsp?d=263&a=654

If someone offers me a bank draft, what should I do?
Bank drafts are cheques drawn by a bank usually on its own Head Office. Payment is guaranteed provided the draft is genuine and has not been lost or stolen. If it is fraudulent or conterfeit it will not be paid.

Drafts go through the normal clearing process like any other cheque and if you are offered a bank draft in payment, don't release the goods until you are sure the draft is genuine and has been paid.

Whilst a bankers draft cannot bounce due to lack of funds like a personal cheque it can bounce if it is fraudulent or stolen. Therefore as the link quite clearly shows they need to be cleared through a bank account like a cheque just in case. That means I am correct in saying they are not like cash where you have received guaranteed payment. Where there is any possibility at all that a payment might bounce it cannot be considered guaranteed.

I worked in a bank for many years (2 different high street ones) and the bankers draft system has slowly eroded. In the 'old days' they were safe, but now more and more stolen or plain counterfeited ones are doing the rounds. The problem is that many people don't know what a bankers draft is supposed to look like, I certainly wouldn't be able to tell say a genuine Barclays draft from a clever ounterfeit purely because I would have no idea what a real one currently looked like.