Bank Drafts Explained: Types, ACH Transfers, and How to Deposit Online (2025 Guide)
Secure Payments Made Simple: Understanding Bank Drafts, ACH, and Automatic Transfers
When it comes to safe, guaranteed payment methods, bank drafts are a trusted tool. Whether you’re handling a large transaction, setting up regular payments, or using digital banking features, knowing how bank drafts work is key. This guide breaks down the essentials of bank drafts, including ACH transfers, automatic payments, and how to deposit bank drafts online.
We also look at how Simplii Financial and Tangerine offer practical options to manage drafts and digital payments.
What Is a Bank Draft?
A bank draft is a secure payment method issued and backed by a bank. It guarantees that funds are available and that the payment will not bounce. Unlike personal cheques, bank drafts provide peace of mind for both parties.
Key Features:
- Guaranteed funds
- Accepted for high-value transactions
- Issued by your bank upon request
Types of Bank Drafts Explained
There are several forms of bank drafts used in different situations:
1. Traditional Bank Draft
A physical paper draft issued by a bank. You can request one at a branch or online (via banks like Simplii and Tangerine).
2. Electronic Bank Draft (ACH Transfer)
ACH (Automated Clearing House) transfers are digital versions of bank drafts. These are used for direct deposits, bill payments, and payroll.
ACH transfers are common for:
- Salary deposits
- Utility payments
- Subscription billing
3. Automatic Draft Payments
Recurring payments set on a schedule. Ideal for rent, mortgage, loan repayments, or monthly bills.
Bank Draft vs ACH: What’s the Difference?
How to Deposit a Bank Draft Online
Thanks to mobile banking apps, depositing a bank draft is now straightforward. Banks like Simplii and Tangerine support this process.
Steps to Deposit a Bank Draft Online:
- Log in to your online or mobile banking app.
- Choose Deposit and follow prompts to scan the draft.
- Upload a clear image of the front and back.
- Submit and confirm the transaction.
Need help? Check Barclays Bank Draft Services for full instructions.
How to Fill Out a Bank Draft
In most cases, your bank handles this, but if you’re issuing a business draft:
- Write the payee’s name clearly.
- Specify the amount.
- Add a memo if needed.
- Sign and date.
For personal use, simply request the draft from your bank and provide the payee details.
Simplii Bank Draft & Tangerine Bank Draft Options
Both banks offer secure and easy online bank draft features:
Simplii Financial
- Request drafts through online banking.
- Set up automatic draft payments.
- Low fees and real-time control.
Tangerine Bank
- Simple draft requests via app.
- Supports recurring payments.
- Efficient for both personal and business use.
Visit Tangerine Draft Services
FAQs About Bank Drafts
Can a Bank Draft Be Cancelled?
Usually, no. Bank drafts are guaranteed. In cases of fraud or error, contact your bank immediately.
How Long Does It Take to Process?
- Traditional bank draft: 1–3 business days
- ACH transfer: Often same or next day
What’s the Cost of a Bank Draft?
Most banks charge $5–$10. Check your provider for exact fees.
Is an IBAN or SWIFT Code Required?
Not for domestic drafts, but international drafts may require IBAN/SWIFT codes.
Use our IBAN Checker or SWIFT Code Checker to confirm.
Final Thoughts
Whether you’re managing one-time payments or automating monthly bills, understanding the difference between bank drafts, ACH transfers, and automatic payments helps you choose the best option. With banks like Simplii and Tangerine offering digital access, it’s easier than ever to manage your money securely.
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