What is a bill?
Every person has ever heard the word "bill". But, probably, not everyone understands its value. And this is not at all surprising, because not everyone is faced with the design of debt receipts, so they may not know what a bill of exchange is and why it is necessary.
Bill: the meaning of the word
Bill - a written document in which the obligation of the debtor to pay a specified amount in a certain period. The bill is binding. This is a valuable document for which it is necessary to pay in an indisputable manner.
The origin of the bill comes from the German word “Wechsel”, which in Russian means “exchange”. This term, which appeared since ancient times, is relevant in the modern world.
The main difference of a bill from other securities is that a bill is an order paper. A legal or natural person who holds a bill is a lender. At registration of documentation this person receives the status of the holder. The definition of the debtor on the bill is directly dependent on the type of bill: when you make a promissory note -maker; when you make a bill of exchange (draft) - the drawee.
What is a promissory note?
This is a security issued by a drawer in the name of the drawer. It is she who certifies the right for a lender or lender to receive payment at a certain time.
Bill of exchange or draft
A draft is an unconditional order of the creditor (drawer) to the debtor (drainage board) to pay the amount specified in the bill to a third party (payee) or to the bearer of the bill in a specified period. A bill of exchange is most often used as a means of payment. For additional guarantees, you can avalize the bill in the bank.
Summarize what a bill. The bill is one of the debt obligations, which is drawn up in a strictly specified form. The basis for the discharge of a bill are exclusively monetary obligations. To bill was a valid document, it must contain all the necessary details.