(a) Under the Bills of Exchange Act, 1961 (Act 55) in Ghana, which governs negotiable instruments in the banking sector, a bill of exchange is defined as an unconditional order in writing, addressed by one person (the drawer) to another (the drawee), signed by the person giving it, requiring the drawee to pay on demand or at a fixed or determinable future time a sum certain in money to or to the order of a specified person (the payee) or to bearer. In practical banking terms, bills of exchange are commonly used in trade finance, such as in letters of credit or export financing at banks like Ecobank Ghana, where they facilitate international payments by allowing the drawer to instruct a bank (drawee) to pay a supplier (payee). This instrument ensures secure, documented transactions, aligning with Bank of Ghana’s Payment Systems and Services Act, 2019 (Act 987), which promotes efficient payment mechanisms to reduce operational risks in the post-2017 banking cleanup era.

(b) Negotiability is a key feature of certain instruments under Ghanaian law, particularly bills of exchange and cheques, allowing them to be transferred freely in commerce, akin to cash but with added security. The characteristics of negotiability include:

• Transferability: The instrument can be transferred by mere delivery (for bearer instruments) or by endorsement and delivery (for order instruments), without needing to notify the debtor or obtain consent, facilitating quick circulation in business transactions like supply chain financing at GCB Bank.
• Good Title to Holder in Due Course: A holder in due course, who acquires the instrument in good faith, for value, and without notice of defects, obtains a better title than the transferor, free from prior equities or defenses (except absolute defenses like forgery). This protects innocent parties and encourages trust in instruments, as seen in Basel II/III-aligned risk management where banks assess holder status to mitigate credit risks.
• Presumption of Consideration: Negotiable instruments are presumed to be issued for valuable consideration, shifting the burden of proof and streamlining enforcement in court, which is crucial for banks recovering funds during liquidity crises, such as those experienced by collapsed banks like UT Bank due to poor governance.
• Unconditional and Certain: The promise or order must be unconditional and for a sum certain, ensuring enforceability without external references, supporting efficient digital banking trends under BoG’s Cyber and Information Security Directive 2020.
• In Writing and Signed: Must be in writing and signed by the maker or drawer, providing evidentiary value in disputes, as emphasized in corporate governance practices at Stanbic Bank Ghana.

These characteristics integrate into modern banking by enabling seamless fintech integrations, like mobile bill payments, while ensuring compliance with BoG directives for resilient operations post-DDEP recovery in 2025.

(c) In Ghanaian banking law, under the Bills of Exchange Act, 1961 (Act 55), crossings on cheques modify their transfer and payment rules to enhance security against theft or misuse, particularly relevant in day-to-day operations where banks like Access Bank Ghana handle high volumes of cheque transactions. The key differences between a ‘not negotiable’ crossing and a ‘not transferable’ crossing (noting that the question likely refers to ‘not transferable’ as the OCR may have rendered it as ‘translirable’) are as follows:

• ‘Not Negotiable’ Crossing: This involves adding the words “not negotiable” within the crossing lines on a cheque. It makes the cheque transferable (i.e., it can still be passed to others) but removes its negotiability. Consequently, the transferee cannot become a holder in due course and takes the cheque subject to any defects in the title of the transferor. Per Section 81 of Act 55, the holder has no better title than the person from whom they received it. Practically, this protects banks from liability in cases of stolen cheques but allows circulation among trusted parties, aligning with BoG’s Liquidity Risk Management Guidelines by reducing fraud risks without halting transfers entirely.
• ‘Not Transferable’ Crossing: This is typically achieved by adding “account payee” or “A/C payee only” across the cheque, rendering it non-transferable. The cheque can only be collected by or credited to the account of the named payee and cannot be endorsed or transferred to another person. This provides maximum security, as it restricts payment strictly to the intended recipient, preventing endorsement to third parties. In Ghana, while not explicitly termed “not transferable” in the Act, courts and banking practice recognize “account payee” as effecting non-transferability, similar to UK precedents adopted in common law. This is vital in ethical banking to prevent money laundering, as per BoG’s sustainable banking principles, and was reinforced post-2019 cleanup to bolster compliance.

In summary, ‘not negotiable’ affects the quality of title upon transfer (still transferable but with risks), while ‘not transferable’ prohibits transfer altogether, ensuring direct payment to the payee. Banks train staff on these distinctions to avoid operational errors, such as wrongful honoring, which could lead to vicarious liability under tort law or regulatory penalties from BoG.