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DD Cancellation Letter

DD Cancellation Application Format to Bank

Last Updated 13th Jun 2021

  • DD cancellation could be done in case of incorrect payee details, DD is used at the wrong place, or incorrect fund transfer.
  • Cancellation of demand draft requires you to visit the bank branch where you applied for your DD.
  • DD Cancellation Letter to Bank must be precise and clear.
  • The DD cancellation letter should be addressed to the Branch Manager, from where you have applied the DD.
  • The DD cancellation charges vary across all banks and range between ₹ 75 to ₹ 250 in most cases.
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What is a DD?

A DD or Demand Draft is a financial instrument in physical form that enables the transfer of funds from one form to another. Demand drafts are considered one of the safest forms of means for transferring funds; thereby, various business and educational institutions considered DDs the primary source of making payments. A DD is issued by the bank in favour of the other based on the amount available in one’s bank account or based on the bank’s payment. This makes the DD a reliable option for making and receiving payments.
However, many times, the DD may need to be cancelled. The reason for DD cancellation could be anything such as incorrect payee details, DD used at the wrong place, or incorrect transfer to DDs. Thereby, filling the DD cancellation application form becomes important in such cases.

How to Cancel DD?

You can get your DD cancel if you fit in any of the situations mentioned above. However, it is crucial to note that not all banks provide the online DD cancel application facility. Any application for cancellation of demand draft requires you to visit the bank branch where you applied for your DD, either for cancelling it or for collecting the DD. Some of the ways in which you can file your application for cancellation of the demand draft are listed in the further sections.

Types of the DD Cancellation Processes

Two types of DD cancellation process are based upon the issuance procedure for demand draft, as explained below:

  • DD issued by paying cash: If the demand draft is issued on making a cash payment to the Bank, you need to submit the demand draft and the cash payment receipt. On DD cancellation, the Bank will refund the cash amount by deducting the DD cancellation charges. Besides, to that, some banks may require you to get a revenue stamp affixed on the DD to validate the Bank DD cancellation letter.
  • DD is issued by amount deduction from bank account: If the DD is issued to you on deducting the required amount from your bank account, you need to submit a demand draft cancellation letter to fill the DD cancellation form. The application letter or the form has to be submitted along with the original DD. After the DD cancellation letter to the Bank is submitted successfully, you may receive the DD amount in your bank account only after the deduction of the DD cancellation charges. However, in case the DD time limit has expired and it has still not been encashed by the payee, then the amount will be credited back to your bank account. In that case, you need to first get the DD to revalidate and then get it cancelled.

In case you have lost the DD and you wish to get it cancelled, you need to submit a DD cancellation letter and an indemnity bond on a stamp paper.

DD Cancellation Letter to Bank

The information mentioned above clarifies that writing and submitting a DD cancellation letter to the bank is both important and mandatory to get a DD Cancelled. However, not many are aware of the correct dd cancellation letter format. Here are some tips that can help you draft a DD cancellation letter properly.

  • The language of the letter should be precise and clear.
  • Clearly mention the reason for getting the DD cancelled.
  • The subject of the DD cancellation letter should indicate the intention and must relate to the content.
  • The DD letter should be addressed to the Branch Manager, from where you have applied the DD.
  • Mention all required details of the DD such as DD number, DD amount, date of issuance, DD on which drawn, DD cancellation reason.
  • Mention all details of the DD in capital letters so that the information is readable and clear.
  • In case of cheque payment, enter your account number accurately. However, in case of cash payment, attach the cash receipts.
  • Enclose the DD cancellation letter with signature, name and account number.
  • Most importantly, ensure that you get your DD cancel as per the demand draft cancellation time limit.

Sample of Demand Draft Cancellation Letter Format

A Sample of the DD cancellation letter is stated as follows:

Date of DD cancellation in format DD/MM/YYYY

The Branch Manager,
Name of Bank,
Name of the Bank Branch
Address of the Bank Branch

Subject: Cancellation of Demand Draft No- (Demand draft number) dated- (date of demand draft) for Rs- (amount of the demand draft) in favour of (Name of the person in whose favour DD drafted) drawn on (Payee bank branch name) due to the reason (mention reason for the cancellation of DD).

(If DD amount is paid by cash)- I request you to make a cash payment to me for cancelling the demand draft with DD No- (Demand draft Number) dated on (date of demand draft) in favour of (Name of the person in whose favour it was drafted).


Further, I allow the Bank to deduct the DD cancellation charges, if applicable, towards cancellation of the concerned demand draft.
Thanking you in anticipation.

Yours Sincerely,
Signature
Full name of the applicant
Address
Contact number

What are the Charges for DD Cancellation?

Similar to how Banks charge an issuance fee for issuing a demand draft, banks charge a fee for DD cancellation as well in order to cover up the documentation and administration charges spent on issuing the DD. The DD cancellation charges, however, vary across banks. DD cancellation charges for some of the Popular banks are listed as follow:

BankDD Cancellation Charge
SBI₹ 200
ICICI Bank₹ 100
Axis Bank₹ 75 to ₹ 125
HDFC Bank₹ 100
PNB₹ 100 to ₹ 250
BoB₹ 75 to ₹ 200

FAQs

Can I cancel Demand Draft online?

In general, you cannot cancel your demand draft online. In order to get the DD cancel, it is compulsory to visit the bank branch where you have applied for the Demand draft to get your DD cancelled.

Can I cancel the demand draft in any branch?

No, you cannot cancel your demand draft in any branch of the Bank, but only at the branch where you have applied for a DD. Similarly, the DD can be cancelled only by the person who applied for it and not by anyone else on his or her behalf.

How many days is a bank DD valid?

As per the current RBI directives, a demand draft is valid for three months. If the payee doesn't get this DD issued within three months, then the DD loses its validity. However, the amount does not get automatically credited to the concerned bank account. In order to get this DD revalidate, one is required to visit the bank branch where DD is issued and complete the process to get it credited back.

Can Demand Draft be cancelled and refunded?

Yes, a demand draft can be cancelled and refunded if it is done within the stipulated time. The DD is refunded to the applicant in cash or is credited to the account, depending upon the payment method used. However, the Bank refunds the amount after deducting the DD cancellation charges.

Can DD be encashed in any bank?

No, DD can be encashed only in the Bank, where the recipient holds an account, and that too at a particular branch.


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