Definition

Noun: A banker's draft is a type of financial instrument. It is a payment order, similar to a check, but it is guaranteed by the issuing bank. The bank draws it against its own funds or funds it holds securely, making it a very secure form of payment.

Usage

A banker's draft is used for large or important transactions where a personal check might not be accepted due to risk. The bank's guarantee means the payment is certain. - The seller required a banker's draft for the car purchase to ensure the funds were secure. - To pay the deposit on the house, we obtained a banker's draft from our bank.

Advanced Usage

• "to request a banker's draft": to ask a bank to issue this instrument.
  • You can request a banker's draft at your local branch for a fee.
• "to clear a banker's draft": the process by which the receiving bank verifies and makes the funds available. This process is typically faster than for a personal check.
  • The funds from the banker's draft cleared within one business day.

Variants and Related Words

• Bank draft (n): A common synonym for banker's draft.
  • A bank draft is often used for international transactions.
• Cashier's check (n): A very similar instrument used primarily in the United States, also guaranteed by the issuing bank.
  • The institution accepted either a cashier's check or a banker's draft.

Synonyms

• Bank draft: A direct synonym.
• Demand draft: Another term sometimes used, especially in certain banking contexts.

Related Phrases

• "as good as a banker's draft": An idiom describing something that is considered very secure or guaranteed.
  • His promise is as good as a banker's draft; you can trust him completely.

Noun

1. a draft drawn by a bank against funds deposited in another bank