Page 179 - DCOM208_BANKING_THEORY_AND_PRACTICE

Banking Theory and Practice

Notes 10.7 Keywords

Cheque: a written order directing a bank to pay money;
Drawee: The party directed to pay the amount of a draft or check.

Drawer: The party who draws the draft upon another party for payment.
Endorsement: The act of signing a cheque for the purpose of transferring it to somebody else.
Payee: The person to whom a cheque, money order, etc., is made out.
Promissory Note: promise to pay
Sworn Statement: also known as “affidavit”

10.8 Review Questions

1. Discuss the history of Indian Banking System.
2. Elaborate on the present scenario of banking system in India.
3. Discuss the role and functions of RBI.

4. Explain what are cheque and the different types of cheques.
5. Elaborate the liabilities of collecting banker and paying banker.
6. What do you understand by holder and holder in due course?
7. Explain the special characters of bills of exchange.
8. What are the different types of endorsements? Explain.

Answers: Self Assessment

1. False 2. False
3. True 4. True
5. True 6. False
7. True 8. Transferable

9. Inchoate 10. Money
11. Maker 12. Payee
13. Section 31 14. Theft, or under a forged endorsement
15. Privileged 16. Liability

17. Endorsed 18. Guernsey Order

10.9 Further Readings

Books Hajols. T. N (2009), “Money and Banking”, Gopaljee Enterprises.
Muraleedharan, D (2009), “Modern Banking: Theory and Practice”, PHI Learning
Pvt. Ltd.

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