Parts Of A Bill Of Exchange

• Date

• Term

• Amount

• Stamp

• Parties

Advantages of Bill of Exchange

1. A Bill of Exchange is used in settlement of debts

2. It fixes the date of payment

3. It is a written and signed acknowledgement of debt

4. A debtor enjoys full period of credit

5. A drawer can convert the bill into cash by getting it discounted with the bank

Kinds of Bills Of Exchange

• Inland Bill

• Foreign Bill

• Trade Bills

• Accommodation Bills

• Demand Bill

• Time Bill

Hundis

• There is evidence to show that Hundis were discovered by Hindu merchants and bankers in
ancient India. The term Hundi comes from the Sanscrit word “Hund” which means “to collect”.

Types of hundi

• 1. Shah Jog Hundi (A Shah Jog Hundi is one which is payable only to a Shah)

• 2. Nam Jog Hundi (A Nam Jog Hundi is one which is payable to the party named in the Hundi or
according to his order)

• 3. Firman Jog Hundi ( A firman Jog Hundi is one which is payable to the order of the holder)

• 4. Dhani Jog or Dekhander Hundi ( These are Hundis payable to bearer)

• 5. Jawabe Hundi ( A jawabe Hundi is one through which money is remitted from one place to
another)

• 6. Jokhmi Hundi ( A jokhmi Hundi is advantageous to the seller of goods because he gets the
purchase price [less insurance premium] immediately)