A written order by the first party, called the drawer, instructing a second party, called the drawee (such as a bank), to pay money to a third
party, called the payee. An order to pay a sum certain in money, signed by a drawer, payable on demand or at a definite time, to order or bearer.
A tentative, provisional, or preparatory writing out of any document (as a will, contract, lease, and so on) for purposes of discussion and correction, which is afterward to be prepared in its final form.
Compulsory CONSCRIPTION of persons into military service.
Also, a small arbitrary deduction or allowance made to a merchant or importer, in the case of goods sold by weight or taxable by weight, to cover possible loss of weight in handling or from differences in scales.
A draft that is payable on demand is called a sight draft because the drawee must comply with its terms of payment when it is presented, in his or her sight or presence, by the payee. In contrast, a time draft is one that is payable only on the date specified on its face or thereafter.
A draft may be payable to a designated payee or to the bearer—the person who has possession of the draft at the time it is presented to the drawee for payment—pursuant to the drawer's directions.
A draft is sometimes synonymous with a bill of exchange, COMMERCIAL PAPER, or negotiable instrument.