Bank Draft (redirected from bank drafts)

Bank draft

A draft addressed to a bank.

---

Bank Draft

A check whose payment is guaranteed by a bank. In exchange for a fee, a bank issues a bank draft to a person, who is very often both the payer and the payee. That is, a person gives the bank the amount for which the registered check is written, either in cash or by deducting the appropriate amount from the payer's account; the bank then makes the check payable to that person. The person may cash the check at any bank, or deposit it at a different bank without being subject to a check hold. Alternatively, a bank draft may be payable to a third party, especially when the person drawing the bank draft is making a large purchase. A bank draft is also known as a certified check, banker's draft, or registered check. See also: Traveler's cheque, Commercial draft.