Negotiable Instrument 

A negotiable instrument is a written document that represents a promise to pay a specific amount of money to the bearer or to a specific person or entity. The person who issues the negotiable instrument is called the issuer or maker, while the person who receives the instrument is the holder.

Here are some common types of negotiable instruments:

Promissory Note: A written promise to pay a specific amount of money to the bearer or to a specific person or entity on a specific date or on demand.


Bill of Exchange: A written order from the issuer to the holder to pay a specific amount of money to a third party on a specific date or on demand.


Cheque: A written order from the issuer to the holder's bank to pay a specific amount of money to the bearer or to a specific person or entity.


Bank Draft: A written order from a bank to pay a specific amount of money to a third party.

Negotiable instruments are commonly used in commercial transactions as a means of payment, as they can be transferred from one person to another by endorsement or delivery, without the need for a formal legal transfer of ownership. They are also widely accepted by banks and financial institutions as collateral for loans or as a means of obtaining credit.

Negotiable instruments are regulated by specific laws and regulations that define their characteristics, including their transferability, endorsement, and payment.