Bank draft

Drafts, cheques and similar instruments can not be lodged in to any account. Such instruments have to be presented for payment at the bank on which the instrument is drawn and the cash collected before it can be lodged into your bank. Banks provide this service, they physically collect these instruments and deliver them to the bank on which the instrument is drawn at some point in the process. This physical operation is costly and not surprisingly you will be charged for it. Usually the rate you get will be from the date the instrument was cashed and it is unlikely you'll get their best rate on the day.

Now if the cheque or draft is from a reputable source or for a small amount, the bank will normally advance you a credit immediately against the instrument, so it looks as if the cheque has indeed been lodged to your account. But if the bank fails to collect the money from the paying bank, there are normally provisions in their T&C enabling them to recover the credit they granted you.

These days a direct transfer of some kind is at least as safe as a draft and definitely cheaper. In the case of the US, if you are dealing with a local bank they may not be well setup to handle international transfers and using one of the other electronic exchanges might be a better way to go.