We have all heard the word Demand Draft or the word DD and have used it in some or the other way – be it in college, business or government institutions. DD can be used for personal and professional use. DD or Demand Draft is a printed draft issued by a bank which is made by the payee to make the payment in advance in the favor of the beneficiary. Companies prefer DD, because it assures them that they receive their payment without fail. There are no risks of bouncing of cheques hence demand drafts are preferred. Choose a demand draft to pay your tuition, exam or any other application form fees like IBPS PO Application form fees. You must know these things before preparing demand draft.
Creating a DD is a tedious work and people often try to avoid making them. But if there is no other method preferred and DD is the only option to pay then you must know what needs to be done to get yourself a DD. This article will inform you and help you know about the things one should know before creating a DD.
Points to remember before applying for Demand Draft:
Be absolutely sure of making a DD
Making a Demand Draft is tedious work for both the bank and you. Probationary Officers handle demand drafts and see to it if it is processed properly. Once you apply for DD, be sure that you don’t have to cancel it later because those cancellations will lead you to a penalty. The amount for DD is charged according to the amount for which the DD is made. It ranges from Rs. 25 – Rs. 50 till 10000 and Rs. 5 on each Rs. 1000 if it’s above Rs. 10000. Therefore, always double sure whenever you plan to make payment through DD as the deduction is quite high when it is above 10k. To avoid these deductions, one should be sure to pay it via DD method without second thought of any other method. Since, other options don’t have a cancellation charge. It is advised to a confused person, not to make a DD.
Having a bank balance equivalent to your DD
Whenever a demand draft is made, having an equivalent balance in your account is important as it freezes the amount declared in DD. It ensures that beneficiaries may credit whenever they wish to encash until it is valid. Therefore, it is important to check your account before filling and submitting forms for DD creation.
Apply for DD with correct details
While making a DD, one must visit their respective bank and fill a form. With form you should also have money or cheque of your account in the favor of the payee. Fill the Name of the beneficiary, City of the recipient, Amount, Branch and the name of applicant. It is very crucial to fill the form correctly and accurately as misinformation can cause delay and sometimes money is transferred to an unknown person. You can also fill the form online, sitting on your couch and watching TV all with the comfort from your home.
Timely submission of Form
The payment by demand drafts typically take 2-3 days to clear and the same goes with preparation of DD. Sometimes, in case there are bank holidays it may take at least 4-7 days. Therefore, it is highly advisable to fill the form prior 10-15 days from the due date so that the bank gets enough time and you make your payment within the due date especially in the case of exams. This method is preferred for school, college or any government Institutions. In today’s modern era of technology, there are many other options like UPI, money transfer, etc. which makes our life easy and fast.
Even if DD is a guaranteed way to get businesses their payment, it is an exhausting job to get them clear. UPI, RTGS, NEFT and IMPS are some of the newer ways to pay the businesses and services which not only assure the payment it is also a fast medium to do a transaction. Everything has its own merits and demerits and so has the demand draft. Well, it is the safest medium of transaction till date. If you wish to be a part of this process and work, apply for IBPS PO and if you have already applied, do not forget to check IBPS PO Exam dates. Hope this article helps you understand DD in a better way and creating a DD would be a piece of cake for you after reading and understanding this article.