05 banking transactions

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05 banking transactions

  1. 1. BANKING TRANSACTIONS DEFINE THE TERM BANK. A bank is an intermediate party between borrower and lender. It borrows from one party and lends to another. DEFINE BANK ACCOUNT. Bank account is used to deposit the money into the bank. ENLIST THE TYPES OF BANK ACCOUNTS. There are three types of accounts:  Fixed deposit account  Saving account  Current account DEFINE FIXED DEPOSIT ACCOUNT. It is an account in which amount remain fixed for a specific period. The bank allowed high rate of interest on this account. DEFINE SAVING ACCOUNT, It is an account in which amount can be withdrawn but within a specific limit the bank allowed interest on this account but the rate of interest is lower than the fixed deposit account. DEFINE CURRENT ACCOUNT. It is an account in which deposit or withdrawal can be at any time during banking hour. Bank allowed no interest in current account DEFINE CHEQUE. A cheque is an unconditional order in writing drawn by a customer on his bank requesting to pay on demand a certain sum of money. ENLIST THE TYPES OF CHEQUES. Cheques are of three types:  Bearer cheque  Order cheque  Crossed cheque DEFINE BEARER CHEQUE. It is a cheque whose amount is payable to the holder of the cheque. DEFINE ORDER CHEQUE. It is a cheque whose amount to payable to a specific person whose name is written on the cheque. DEFINE DISHONOR TO CHEQUE. When the amount of cheque is not paid by the bank it is said to be dishonored cheque. DEFINE CROSSED CHEQUE. When two parallel lines are drawn across the face of a cheque it is called crossed cheque. It can’t be enchased at the counter but can be collected only by a bank from the drawee bank. Type of crossing  Special crossing  General crossing EXPLAIN PAY-IN-SLIP / CREDIT VOUCHER / DEPOSIT SLIP. Pay-in-slip is used to deposit the amount in the bankPUNJAB COLLEGE OF COMMERCE PROF. HAFIZ MUHAMMAD NAWAZ PAGE 1
  2. 2. BANKING TRANSACTIONS ON WHICH GROUNDS THE BANK REFUSE TO HONOUR THE CHEQUE. The following are the reasons for the dishonor of cheque:  Drawer signature differ  Post dated cheque  Outdated cheque  Mutilated cheque  Not sufficient fund  Amount in word and figure differ DEFINE ENDORSEMENT OF CHEQUE. It is an act of sighing on the back of the cheque in order to transfer it someone else who is called the endorsee. WHAT IS A BANK- DRAFT? It is an instrument which is used for transferring money from one place to another place. It is drawn by bank. EXPLAIN POSTAL ORDER. It is an instrument is used for transferring money from one place to another place. It is drawn by post office. DEFINE HUNDIS, It is an instrument which is used for transferring money one place to another place. It is drawn by one trading firm on its branch.PUNJAB COLLEGE OF COMMERCE PROF. HAFIZ MUHAMMAD NAWAZ PAGE 2

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