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DRAWEE Entity that is expected to accept and pay a bill of exchange (check, draft, letter of credit, etc.

) on presentation or on a certain date (called due date or maturity date). See also payee. Read more: http://www.businessdictionary.com/definition/drawee.html#ixzz2H2oYmVts

payee
Definition
Party to whom a bill of exchange (such as a check or draft) is made payable. Payee's name follows the words 'Pay to the ordBusinessDictionary.com

drawer
Definition
Maker or writer of a bill of exchange (check, draft, letter of credit, etc.) who directs the drawee (such as a bank) to pay the stated amount to a third party (the payee). In documentary credit, the drawer is the beneficiary of a letter of credit. Also called writer.

letter of credit (L/C)


Definition
A written commitment to pay, by a buyer's or importer's bank (called the issuing bank) to the seller's or exporter's bank (called the accepting bank, negotiating bank, or paying bank). A letter of credit guarantees payment of a specified sum in a specified currency, provided the seller meets precisely-defined conditions and submits the prescribed documents within a fixed timeframe. These documents almost always include a clean bill of lading or air waybill, commercial invoice, and certificate of origin. To establish a letter of credit in favor of the seller or exporter (called the beneficiary) the buyer (called the applicant or account party) either pays the specified sum (plus service charges) up front to the issuing bank, or negotiates credit. Letters of credit are formal trade instruments and are used usually where the seller is unwilling to extend credit to the buyer. In effect, a letter of credit substitutes the creditworthiness of a bank for the creditworthiness of the buyer. Thus, the international banking system acts as an intermediary between far flung exporters and importers. However, the banking system does not take on any responsibility for the quality of goods, genuineness of documents, or any other provision in the

contract of sale. Since the unambiguity of the terminology used in writing a letter of credit is of vital importance, the International Chamber Of Commerce (ICC) has suggested specific terms (called Incoterms) that are now almost universally accepted and used. Unlike a bill of exchange, a letter of credit is a nonnegotiable instrument but may be transferable with the consent of the applicant. Although letters of credit come in numerous types, the two most basic ones are (1) Revocable-credit letter of credit and (2) Irrevocable-credit letter of credit, which comes in two versions (a) Confirmed irrevocable letter of credit and (b) Not-confirmed irrevocable letter of credit.

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draft
days date noncash item

Definitions (2)
1. Shipping: (1) Vertical distance between a ship's waterline and the lowest point of its keel. (2) Depth of water to which a ship sinks according to its load. Maximum draft (also called 'deep load draft') occurs when the ship sinks to its Plimsoll line. Practically all ships have parallel horizontal lines drawn on both sides of front (bow) and back (stern) to mark each foot of draft. Also spelled as draught. 2. Trading: Bill of exchange which is a written payment order from one party (the drawer) to another (the drawee) to pay a stated sum to a third party (the payee) either immediately (in case of a sight draft) or on or before a specified date (in case of a time draft). When presented with shipping and/or title documents, it is called a documentary draft; without them, a clean draft. Also called draft bill of exchange. Read more: http://www.businessdictionary.com/definition/draft.html#ixzz2H2qnqXz2

bill of exchange (BOE)


bank draft discounted bill

Definition

A written, unconditional order by one party (the drawer) to another (the drawee) to pay a certain sum, either immediately (a sight bill) or on a fixed date (a term bill), for payment of goods and/or services received. The drawee accepts the bill by signing it, thus converting it into a post-dated check and a binding contract. A bill of exchange is also called a draft but, while all drafts are negotiable instruments, only "to order" bills of exchange can be negotiated. According to the 1930 Convention Providing A Uniform Law For Bills of Exchange and Promissory Notes held in Geneva (also called Geneva Convention) a bill of exchange contains: (1) The term bill of exchange inserted in the body of the instrument and expressed in the language employed in drawing up the instrument. (2) An unconditional order to pay a determinate sum of money. (3) The name of the person who is to pay (drawee). (4) A statement of the time of payment. (5) A statement of the place where payment is to be made. (6) The name of the person to whom or to whose order payment is to be made. (7) A statement of the date and of the place where the bill is issued. (8) The signature of the person who issues the bill (drawer). A bill of exchange is the most often used form of payment in local and international trade, and has a long history- as long as that of writing.

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promissory note
definition
noun a document stating that someone promises to pay an amount of money on a specific date BusinessDictionary.com

bank draft
preauthorization check plan home service insurance

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Bill of exchange drawn by a bank on itself, or on a correspondent bank in another city or country. Bank drafts are commonly used by banks in dealings with other banks, or when a creditor or seller is unwilling to accept an ordinary check from a debtor or buyer in another city

or country. (In local transactions a certified check or a cashier's check serves the same purpose.) When a customer (the drawer) requests a draft, the bank withdraws the amount of the draft from his or her account and holds it to honor the draft on its presentment by the drawee. Because, in normal circumstances, a draft is certain to be paid, it is generally accepted as a cash equivalent. Also called banker's draft.