Drafts and cheques

When your partners don't use
electronic payments

Some of your trading partners may prefer paper-based payments - so we can clear drafts and cheques from overseas and currency cheques drawn in the UK on behalf of your business.

However, we do not recommend this form of payment because of the concern over security.

Key benefits

  • Foreign currency cleared - we will clear cheques and drafts drawn on banks abroad or foreign currency drawn in the UK
  • Save time and costs - items that are in the same currency, drawn on banks in the same country and being handled by negotiation can be paid into your account with a single transaction

Payment by negotiation and collection

Drafts and cheques from abroad can be handled either by negotiation or collection.

By negotiation

A draft or cheque can only be paid by negotiation if it is in the local currency of the country on which it is drawn - for example, US dollars payable in the US. Even so, we might still have to send it for collection.

Once agreement to negotiate with recourse has been made, foreign currency cheques will be credited to your account within 4-5 working days of us receiving the cheque. We will normally pay you the value of the draft or cheque, less our charges. We will use a cheque-buying rate to convert currency if necessary.

Payment by negotiation charge:
0.25% per pay-in (Min £7 - Max £45)

If the payment is not honoured by the paying bank, we will debit the value of the draft or cheque plus a handling fee. If a foreign exchange conversion is required, we will calculate the amount to debit your account using the prevailing sale rate at the time of the debit.

By collection

Some drafts and cheques are more likely to be sent for collection. For example, payments that originate in high risk countries or those that aren't in senders' local currencies may well be collected.

We won't credit your account until we have received the funds or are sure that the item will be paid. How long this takes will depend on the country the payment is coming from and the bank clearing the payment.

Wherever possible, ask for sterling drafts drawn on a UK bank. These can be paid directly into your Royal Bank of Scotland sterling account.

Payments by collection charge:

Cheques sent abroad:
0.25% per item (Min £20 - Max £70) plus Agent's charges

Cheques sent to other banks in the UK:
£12.00 flat per item plus Agent's charges

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