bill of exchange
(banking) An unconditional order in writing, signed by a person (drawer) such as a buyer, and addressed to another person (drawee), typically a bank, ordering the drawee to pay a stated sum of money to yet another person (payee), often a seller, on demand or at a fixed or determinable future time.
The most common versions of a bill of exchange are:
(a) A draft, wherein the drawer instructs the drawee to pay a certain amount to a named person, usually in payment for the transfer of goods or services. Sight drafts are payable when presented. Time drafts (also called usance drafts) are payable at a future fixed (specific) date or determinable (30, 60, 90 days etc.) date. Time drafts are used as a financing tool (as with Documents against Acceptance, D/A terms) to give the buyer time to pay for his purchase.
(b) A promissory note, wherein the issuer promises to pay a certain amount.