Commercial draft

(redirected from Commercial Drafts)

Commercial draft

Demand for payment.

Commercial Draft

A request or demand for payment made by a bank on behalf of a third party. While the recipient of the commercial draft is not bound to honor it, refusal to do so may hurt his/her credit at the bank issuing the demand. For example, if Fred owes Joe money, Joe may ask a bank to issue a commercial draft, which Joe or a courier presents to Fred. Fred is not legally obliged to pay Joe, but if he does not, he may find difficulty securing a loan from the bank and other banks associated with it.
References in periodicals archive ?
The Commercial Cooperation Committee talks on Wednesday discussed the operation of several joint commercial drafts in preparation for their adoption as mandatory across all of the six states like the anti-commercial fraud law, and an auditing law.

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