Check
1.
According to the Negotiable Instruments Law of China and PBC's regulations on settlement, customers can use cash or transfer checks for settlement. Open checks are widely used in Shenzhen to withdraw and transfer money. Crossed checks with two parallel lines in upper-left corner can only be used to transfer money. Enterprise and individual customers can use checks for settling accounts in the same instrument exchange region.
2.
Checks must be payable to order and be transferable based on endorsement.
3.
The payment period for a check is 10 days, starting on the issue date. The maturity date is postponed if falls on a public holiday.
4.
The check issuing date, money amount and payee's name must not be altered. Other information can be altered by underlining mistakes and sealing the check with the reserved stamp.
5.
The holder must report lost checks to the payment bank. If the check is cashed before the report, the bank will refuse the report.
6.
If the check issuer issues a bad check, uses the wrong stamp or enters the wrong payment password, the bank will bounce the check and fine the issuer 5% of the check's par value with the minimum fine being RMB1,000.
Cashier's check
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A cashier's check is issued by a bank to unconditionally pay a specific amount to the payee or instrument holder on submission of the cashier's check. Enterprise and individual customers can use cashier's checks for to settle accounts in the same instrument exchange region.
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·Holders of cashier's checks issued by CMB can cash these checks at any local bank. Holders cannot report missng cashier's checks that can be cashed anywhere.
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Cashier's checks can be used for transfer of accounts. Cashier's checks marked with "Cash" can be used to withdraw cash.
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The payment period of a cashier's check must not exceed two months from the issue date.
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If the applicant or payee is a company, the bank will not issue a cash cashier's check. aCashier's checks are transferable based on endorsement, excluding those marked with "Cash".
Bank draft
1.
A bank draft is issued by a bank to a remitter who deposits a remittance at the bank for settlement or withdrawal in another place. It applies to various types of remittances by individuals and companies.
2.
Bank drafts can be used for transfer of accounts. Bank drafts marked with "Cash" can be used to withdraw cash.
3.
If the applicant or payee is a company, the bank will not issue a cash bank draft.
4.
A bank draft must be payable to order and is transferable based on endorsement.
5.
A bank draft's payment period is one month from the issuing date.
6.
If no acting payer is designated, the bank will not accept a missing report or suspend payment, but it will help avoid any loss of money.
7.
You must take the bank draft and remittance cancellation notice to the issuing bank to apply for a refund when a bank draft becomes mature or if another reason applies. If you cannot provide the remittance cancellation notice, you can only apply for a refund one month after maturity of the payment period (i.e., two months from the issuing date). If your bank draft is missing, you can take the valid proof issued by a people's court to the bank one month after the payment period expires to apply for a refund.
Commercial draft
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Commercial Drafts are issued by the drawer to be cashed by the acceptor to make payments to the payee and draft holder on maturity. They are classified into commercial draft and bank draft by drawer type.
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A commercial draft can be settled any city.
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Commercial drafts must be issued based on lawful commodity transactions.
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A commercial draft must be payable to order and is transferable based on endorsement.
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The acceptance period of a commercial draft is determined by both transaction parties and must not exceed six months.
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Before a commercial draft matures, the payee and endorsee should take the draft to the issuing bank to remind the payee of payment. The bank will not accept a draft if it is 10 days or more overdue.
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The accepting bank will charge the applicant a commission of 0.05% of the par value of the draft.
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The person who loses an accepted commercial should inform the payee who can request that the bank suspend payment.
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The holder of an undue bank draft that meets requirements for a discount can apply for a discount.
Remittance
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Remittance is a settlement means in which the remitter authorizes a bank to make a payment to the payee. It can be divided into mail and telegraphic remittance, and applies to the settlement of various corporate and personal payments.
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The payee can be a company with an account at the remit-in bank or an individual who "deposits a sum of money at the bank for withdrawal".
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After a personal remittance is complete, a payable remittance and temporary deposit account can be opened for money transfers and remittance to the original payee.
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The remitter can apply for a refund of the remitted money. A payee with a deposit account at the remit-in bank can contact the remitter for a refund. If the payee does not have a deposit account at the remit-in bank, the remit-out bank will confirm with the remit-in bank whether the money has been remitted. If not, the payee can apply for a refund.
Collection of payment
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This is a settlement means in which the payee authorizes a bank to collect a payment to the payee. Enterprise and individual customers can apply for the service with commercial drafts, debentures and deposit receipts.
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You can authorize CMB to collect payment from a payer in the same or different city. Upon approval by the local People's Bank, a public utility can authorize CMB to collect public utility fees from users in the city.
Authorized payment collection
After goods are shipped according to a purchase contract, the payee can authorize CMB to collect the purchase payment from the payer in another city. The two parties in the transaction must be state-owned companies, trading cooperatives or collectively owned manufacturers that can demonstrate a strong performance history and have passed CMB's assessment.
Note:
All the contents stated above are for your reference only. Please consult the local branch of China Merchants Bank for further information. China Merchants Bank reserves the ultimate right of interpretation for the contents in this page.