The change, formerly a popular means of payment for business people, has lost much of its popularity. The reason is the elaborate handling. The bill itself is based on a deed whose validity depends on the fact that it formally complies with the provisions of Paragraph 1 of the Interchange Act (WG). Since a bill of exchange is always issued to the beneficiary by name, a transfer can only be made by the entry of the next beneficiary, the endorsement, on the back of the certificate. The bill combines the characteristics of a tender with the criteria of a loan.

The change loan – the deferred payment

Why a bill actually represents a bill of exchange credit becomes clear from the legal components:

  • Exhibition location and date of issue
  • The term “change” must be noted in the exhibition language on the document.
  • Name of the bill of lading, the beneficiary
  • The unconditional payment order of a certain sum
  • payment
  • Name of the relative
  • Signature of the drawee
  • Date of maturity

Since the date of maturity differs from the date of issuance into the future, the beneficiary actually grants the drawee an alternative loan. The handling of the payout from a bill is extremely strict. The drawee must have the sum on the due date. A so-called “burst” change is legally seen in court as a “holiday matter” handled. This makes clear the explosive nature of a mutual loan.

Application of the exchange credit

Today, bills are barely used to pay for supplier invoices, but are still used in foreign business. Although the change as such certainly offers advantages, he moved more and more into the background due to lack of “machine capability”. The processing of bills by the banks is extremely labor-intensive. The handling of a bill of exchange and its practical advantages will be illustrated by an example:

Merchant A receives a goods delivery from merchant B and issues a 90-day change. Kaufmann B in turn owes merchant C a certain sum. By means of endorsement, the entry of the name of C on the back of the bill, B now relinquishes his claim against A to C. Merchant C now holds an order paper in his hands, assuring him that he will receive the amount owed by B on a specified day from A.

The most common types of change

There are different characteristics for a change loan. Acceptance is the most common change applied. He bears the signature of the drawee, which is also referred to as the Accept.

The view change is due at sight, ie at presentation. The day change is issued on a specific due date and must be settled on that day.

The change of leniency comes within a certain period of time after the presentation to the debtor or the paying agent for payment. The date change is due after the expiry of a certain period of time after issue.

Furthermore, the distinction between financial change and trade change applies. The first is used to finance a financial transaction, the second is the delivery of goods or the exercise of a service.

The transfer of a bill

There are two options for the transfer of a bill of exchange. One, as already mentioned, is transfer by means of endorsement. In this case, the document must bear the note “for me to the order of …” as well as the signature of the discloser. The endorsement legitimizes the owner to redeem the bill, independent of any actual claim. The handing over, the endorser, is liable for the redemption, but can limit or exclude this liability (fear dossier). The second possibility to transfer a bill offers the assignment, the assignment. However, this has disadvantages in a loan. The assignor is liable only to the person to whom the bill has been assigned. Subsequent bills of exchange are not entitled to any claim against him if they are not redeemed. In contrast to a transfer against endorsement, the claim can not be made in good faith in a cession, there must always be a justification.

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