Difference between Bill of Exchange and Cheque
A cheque is a kind of bill of exchange that is drawn on a specific bank or bank and is payable only on demand. There is a considerable difference between a cheque and a bill of exchange that can be explained as under:-
| Cheque | Bill of Exchange |
| In the case of the cheque only a banker can be a drawee | In the case of bill of exchange it can be drawn on anyone including the banker that can also be the drawee of bill of exchange |
| In the case of cheque there is no need of any acceptance | In the case of bill of exchange it must be presented for the acceptance |
| There are no days of grace regarding the payment of cheque and it is always paid on demand | There are three days of grace regarding the payment of the bill of exchange |
| In the case of cheque no notice of dishonor is required | In the case of bill of exchange a notice of dishonor must be sent to the all parties liable to pay in the case of dishonesty |
| A cheque may be crossed or not crossed | A bill of exchange is never crossed |
| There is no requirement of any kind of stamp | A proper stamp is required in the case of bill of exchange |
| In the case of cheque the liability of drawer continues for next six months | In the case of bill of exchange any kind of unreasonable delay will discharge the bill |
| Cheque may or may not be countermanded | Countermanding of bill of exchange is not possible |
| Statutory protection is available in case of cheque | Statutory protection is not available in the case of bill of exchange |
Other Related Accounting Articles:
- Definition and Explanation of Bill of Exchange
- The Bill of Exchange
- Accommodation Trading
- Accounts Payable Days
- Accounts Receivable Collection Period
- Yearly Price of Protection Method
- Managed Currency
- Bill of materials Definition
- Foreign Exchange Accounting
- Open Market Rate
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Jennifer
Being a professional blogger I like to share my knowledge regarding accounting, finance, investing,bonds and other related topics. In addition to i am a professional accountant in a Multinational company.