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.