Demand Drafts the financial instruments that you can use to make the payment of to a business or to a person. The advantage of the Demand Draft is that the issuing party has already paid the bank for the amount which the demand draft has been issued for. In such a case, the demand draft reduces the risk which is often involved in Cheque. The risk that we are talking about here is the chances of having insufficient balance in the account. There is no such risk involved with the Demand Draft.
Another good part about the demand draft is that it makes it easy to make the payment. You do not have to carry cash with you and it can only be redeemed by the entity for which it has been issued. In addition to this, you must know that there is a certain fee involved in getting the demand draft and while requesting cancellation of demand draft.
There are multiple reasons why you might need to get the demand draft cancelled and there are multiple things that you should know about demand draft. We have listed all such details in the section below
Things to Know about Demand Draft
- The first things that you really need to know are the fact that the demand drafts involve This means that you will have to pay a certain fee while you are getting the demand draft issued and if in case you have to get the demand draft cancelled, then it would also involve a certain fee.
- There can be various reasons for the cancellation. For example, you might want to cancel the demand draft if you have lost it. In addition to this, you might want to cancel the demand draft if it has been issued at the wrong name or if the demand draft has a wrong amount on it.
- Most of the times, you would need to submit the original demand draft bank to the bank for the cancellation but the only time when you do not have to submit the demand draft back is when you have misplaced the demand draft.
- After the cancellation, the bank will give you back your money in form of cash or in the form of account transfer depending on the way you paid for the demand draft. There would be certain charges for the cancellation of the demand draft and that would be deducted from the bank as well.
This was all the possible information about the Demand Draft. You can look at the sample application below and while you are writing one you yourself, just replace the text in bold with the desired information.
The Branch Manager
25 April 2019
Subject: Cancellation of Demand Draft ‘xxxxxx’
I Abhay Sharma with account number 999111223999229 in your bank obtained a demand draft from your bank. The demand draft number was xxxxxx and it was issued for the Payee Simran Sharma Payable at Hyderabad. The mode of payment for getting the demand draft issued was Bank Transfer and unfortunately, I misplaced the Demand Draft. In such a case, I request you to cancel the demand draft and credit the payment back into the above stated account. Please find the details of the draft below.
Account Number – 999111223999229
Demand Draft Number – XXXXXX
Payee Name – Simran Sharma Payable at Hyderabad
Mode of Payment – Account Transfer
Reasons – Demand Draft Misplaced During Transit
Date of Issue – 01/01/2019 to 31/03/2019
Request you to please issue me the cancellation of demand draft and I will be highly grateful to you.
This was the format that you need to use for the cancellation of demand draft and one thing that you need to take care is that you can also call the phone banking to immediately stop the payment of demand draft if you have lost it. This would ensure that if the demand draft is in the wrong hands then it would not be misused and your money will be safe.
Also, as mentioned earlier, you will have to submit the original demand draft for the cancellation. This is true for all the scenario apart from the one wherein you lost your demand draft.
For any other information, please reach out to the bank or the phone banking services as they will be able to share more information about the required procedure.