A bill of exchange is a binding agreement by one party to pay a fixed amount of cash to another party as of a predetermined date or on demand. Bills of exchange are primarily used in international trade. Their use has declined as other forms of payment have become more popular. There are three entities that may be involved with a bill of exchange transaction. They are drawee, drawer and payee. While a bill of exchange is not a contract itself, the involved parties can use it to specify the terms of a transaction, such as the credit terms and the rate of accrued interest. Unlike a check, however, a bill of exchange is a written document outlining a debtor's indebtedness to a creditor. The presentation will give you better understanding on the topic.

Saranya R Kurup

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