The following are the advantages of a bill of exchange:
Image Source: c1.staticflickr.com/7/6018/5929579731_b77775a33c_b.jpg
- Bill of exchange fixes the date of payment. The creditor knows when to expect his money and the debtor also knows when he will be required to make payment.
- A bill of exchange is a negotiable instrument and can be used in settlement of debts.
- it is a written and signed acknowledgement of debt and affords conclusive proof of indebtedness.
- A debtor is free from worries and enjoys full period of credit, as he can never be called upon to pay the amount of the bill before the due to date.
- A creditor can convert the bill into cash by getting it discounted with the bank.