The State Bank of India (SBI) Demand Draft cancellation charges vary based on the draft amount.
Draft Amount | Cancellation Charges |
---|---|
Up to ₹500 | Nil |
Above ₹500 to ₹5,000 | ₹25 + GST |
Above ₹5,000 to ₹10,000 | ₹50 + GST |
Above ₹10,000 | ₹100 + GST |
A Demand Draft (DD) is a secure financial instrument issued by the State Bank of India (SBI) to facilitate guaranteed payments. Unlike cheques, DDs do not depend on the drawer’s account balance. SBI demand drafts are ideal for transactions that require assured payments, such as fees for educational institutions, property purchases, and business dealings.
State Bank of India (SBI) Demand Draft (DD) is a secure financial instrument issued by SBI on behalf of a customer to facilitate guaranteed payments. When an SBI account holder requests a demand draft, they must deposit the specified amount with the bank, which then issues a pre-paid draft for the same amount.
Since SBI backs the payment, it eliminates the risk of bounced checks, making it a reliable payment option. The beneficiary—whether an individual or business—can deposit or encash the demand draft at any SBI branch or other banks where SBI demand drafts are accepted.
Given below are the applicable SBI demand draft charges:
Demand Draft Issue and Amount | Charges (Including GST) |
Up to ₹5,000 | ₹25 |
Between ₹5,000 and ₹10,000 | ₹50 |
Between ₹10,000 and ₹1,00,000 | ₹5 per ₹1,000 (Minimum ₹60) |
More than ₹1,00,000 | ₹4 per ₹1,000 (Minimum ₹600, Maximum ₹2,000) |
IOI Demand Draft | Same as domestic demand draft charges |
Postage/Courier Charges | ₹50 in addition to the above charges |
Cancellation Charges | Up to ₹500: NIL Between ₹500 and ₹5,000: ₹25 + GST Between ₹5,000 and ₹10,000: ₹50 + GST More than ₹10,000: ₹100 + GST |
Currently, this SBI demand draft form cannot be downloaded online. You must visit your nearest SBI branch and collect it.
An SBI demand draft is valid for three months from the date of issuance. If not presented within this period, it becomes invalid but can be revalidated once by the drawer (the person who requested the draft). The revalidation fee is ₹200 plus GST. For SBI demand drafts, an expired demand draft can be revalidated only once. A revalidated demand draft cannot be revalidated again after an extended period.
Here are all the limits of SBI demand drafts:
You can generate a demand draft through SBI using online or offline methods. Below are the detailed steps for each process:
To fill out the SBI demand draft form, follow the steps below:
An SBI demand draft cannot be cancelled online; you must visit a branch in person. When you purchase a demand draft, the amount is immediately debited from your account. However, you can get a refund by cancelling the draft. When cancelling the demand draft from SBI, keep in mind the following:
You need documents such as the original demand draft (DD), the cash receipt issued at the time of purchase, and a completed demand draft cancellation application form (available at the bank). You must submit the documents to the bank to complete the process. The bank will refund the amount in cash after deducting a cancellation fee.
You must submit documents such as the original demand draft (DD), a completed demand draft cancellation form (available at the bank), and the demand draft cancellation application. To complete the process, submit the documents to your SBI branch. The bank will deduct a cancellation fee and process the refund to your account.
To cancel a demand draft, a drawer (a person who requested this draft) must submit a written application to the bank following this prescribed format. Following are all the key prerequisites you need for DD cancellation:
Here are the these essential tips to prevent SBI demand draft frauds:
Following are all the essential differences between the SBI demand draft and the cheque:
Aspect | Cheques | Demand Drafts |
Payment Process | A cheque is a written order from the drawer to their bank to pay a specific amount to the payee. | A demand draft is a pre-paid, bank-issued instrument that guarantees payment to the recipient. |
Issuer | Issued by individuals, businesses, or other entities from their bank accounts. | Issued exclusively by banks on behalf of the customer. |
Payment Guarantee | Payment is not guaranteed and can bounce if the drawer’s account has insufficient funds. | Payment is guaranteed as it is pre-paid and issued by the bank. |
Payment Confirmation | Payment confirmation depends on the drawer’s account balance and can be pending until cleared. | Payment is confirmed before the draft is issued, ensuring funds are available. |
Stopping Payment | The drawer can stop or cancel a cheque, subject to valid reasons (e.g., loss or error). | Once issued, a demand draft cannot be stopped or cancelled by the drawer. |
Parties Involved | Involves three parties: drawer (issuer), drawee (bank), and payee (recipient). | Involves two parties: drawer (bank) and payee (recipient). |
Additional Charges | Typically, no charge for issuing a cheque, but fees may apply for bounced cheques. | Banks charge a fee for issuing a demand draft, which may vary based on the amount. |
Security and Risk | Riskier if not marked “account payee” as it can be cashed by anyone, increasing fraud potential. | Higher security as it can only be claimed by the designated payee, reducing the risk of unauthorised use. |
Acceptance in Transactions | May face limited acceptance in business transactions due to concerns about bouncing. | Widely accepted in business transactions due to its guaranteed payment status and security. |
Dependability | May lack reliability due to the possibility of bouncing or delays in clearance. | Highly reliable, offering swift, secure, and confirmed transactions, especially in digital banking. |
SBI demand drafts provide a secure and reliable way for customers to transfer funds without the risk of counterfeiting or bounced payments. You can easily apply for a demand draft through SBI’s official internet banking portal or by visiting your nearest SBI branch at affordable costs. With nominal charges for issuance and cancellation, SBI demand drafts offer a convenient, cost-effective solution for securely sending and receiving funds.
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1. HDFC Demand Draft
2. How Long is a Bank DD Valid in India?
3. Difference Between Cheque and Demand Draft
4. HDFC Bank DD Charges and Cancellation Fees
5. ICICI Bank DD Charges and Cancellation Fees