A cheque that is drawn in the name of a bank instead of the account holder's name is called?
Answer Details
A cheque that is drawn in the name of a bank instead of the account holder's name is called a bank draft. A bank draft is a type of payment instrument that is guaranteed by the bank, and is often used for transactions involving large amounts of money. When a bank draft is issued, the bank takes the funds from the account of the person who requested the draft, and holds the funds until the cheque is presented for payment. Once the cheque is presented, the bank will then release the funds to the person or entity that the cheque is made payable to. Because bank drafts are guaranteed by the bank, they are considered to be a very secure form of payment, and are often used for international transactions or for payments where there is a risk of fraud or non-payment.