Bills of Finance

A bill of exchange is an unconditional order in writing, addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand or at a fixed or determinable future time a certain sum of money to or to the order of a specified person or to the bearer.

The person on whom the bill is drawn and who must pay.

The three parties are the Drawer (who draws the bill and is the creditor), the Drawee (on whom the bill is drawn and who is the debtor), and the Payee (who receives the payment, which may be the drawer himself).

The person who draws or creates the bill of exchange.

A demand bill (also called a sight bill) is payable immediately on presentation, whereas a usance bill (also called a time bill) is payable after a specified period, such as 30, 60, or 90 days after sight or after the date of the bill.

The person to whom the bill amount is payable.

Acceptance is the act by which the drawee signifies his assent to the order of the drawer by signing his name across the face of the bill, thereby becoming the acceptor and assuming primary liability for payment of the bill on its due date.

Three extra days allowed beyond the due date for payment.