What is cheque discounting ? if cheque is drawn in particular party's name than y they ask not to put a/c payee stamp, in such case they discount, how it work ? can i have clarification pls.
V P Narasimhan
(Accounts Manager)
(791 Points)
Replied 22 July 2009
Dear friend
Chq discounting can be done if we have arrangement & facility with our Bank . Fox example if U hv a chq for Rs:5.00 lacs Outstation other than metro city which will take 7 to 15 days for clearing U can discount. Becoz the realisation of 5.00 lacs ( after Ban k charges) will take after it send outstation for clearing. Whereas if U need money urgently U can discount with the Banker and they will give U some portion of % from 5.00 lacs which they will charge. Say (for exampel tey will give credit for 4 or 4.25 lacs) . On the contrary if that chq passes after the relevent days for 5.00 lacs they will credit balance amount to your account. Most of the business houses use to do so. Banker is also having our instruments in his hand . Whereas if the chq bounces we have to pay heavy amount together with interest.
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