Example of Bill of Exchange

The bill of exchange It is a document by means of which one person orders another to pay a certain amount of money to be paid in favor of a third person.

Its origin was with the Phoenicians, who replaced the exchange and exchange of objects.

The bill of exchange must be distinguished from its direct cousin, which is the promissory note, which establishes a payment bond that allows direct coercion of the collector by judicial means.

Uses of the bill of exchange:

• Payments through a third party
• Collections
• Fund situations
• Fund remittances

The following people may intervene to draw up a bill of exchange:

• The drawer (is the one who writes or issues the document)
• The drawee (she is the one who pays the document, it is extended to his name)
• The beneficiary, also called the policyholder (this is the one who collects the document and extends the document in his favor)

The names of these three terms have been changed respectively to the following:

• Drawer = subscriber drawer.
• Beneficiary = holder, bearer, collector
• Drawn = drawn, payer

For which procedures is a bill of exchange issued:

1. Account value.- This means that the drawee opened a loan to the drawer and for the amount of the credit he issued bills of exchange, which must be done with a study of the current accounts.
2. Merchandise value.- The drawer received merchandise for the value of the amount of the bill of exchange.
3. Understood value.- In this the drawer and the drawee have a specific agreement.
4. Value received in cash.- This is when the drawer received from the beneficiary the amount of the bill of exchange in cash.

The endorsement:

Bills of exchange are usually issued to people who are not fully trusted or unknown, so a guarantee is required, which will guarantee the solvency of the debtor.

This endorsement must be noted on the back of the document.

Validity and expiration

These documents have a legal validity period, which corresponds to a period of three years, which begins from the moment the date is set and the document is signed.

Sample bill of exchange

The data that bills of exchange must have:

1. Date
2. Place where the document is spread
3. Deadline that must have
4. Unconditional order for the drawee to make the payment
5. The word bill of exchange within the document (in the text of the procedure)
6. Place of payment (place where the payment should be covered)
7. The beneficiary (payment must be made to his order)
8. Amount to pay (the amount to be covered is written in letters and numbers)
9. The concept for which the document is received (account or document value etc.)
10. Signature or signature of the drawer
11. Name, address of the person issuing the document (the payer)

Example of endorsement of bill of exchange:

Endorsement

The bills of exchange are credit documents or credit titles, so they are likely to be endorsed and given as payment, for which an annotation is made on the back of the document.

The text consists of a phrase that says:

Pay yourself property to the order of (endorsed name) the value of this document.

Mexico City, June 15, 2016.
Signature of the endorser.

• Bill of exchange to print