Definition of Drawee:
The person or organization, typically a bank, who must pay a draft or bill.
Drawee is a legal and banking term used to describe the party that has been directed by the depositor to pay a certain sum of money to the person presenting the check or draft. A typical example is if you are cashing a paycheck. The bank that cashes your check is the drawee, your employer who wrote the check is the drawer, and you are the payee.
The drawee most often performs the function of an intermediary for a financial transaction. Its purpose is to redirect funds from the payer, or drawer, account to present the funds to the payee. Often, the position of drawee is held by a financial institution that holds the payer funds within a deposit account under its management. Consumer banks regularly perform this function, removing funds from a depositor’s account to pay the obligation listed on a check.
Entity that is expected to accept and pay a bill of exchange (check, draft, letter of credit, etc.) on presentation or on a certain date (called due date or maturity date). See also payee.
How to use Drawee in a sentence?
- Most often, if you deposit a check, your bank or check-cashing service is the drawee.
- Our company served as the drawee for the Insurance company. We collected the money through their monthly T&I payment, and then paid the premium once it was due.
- You should always make sure to be on time as the drawee so that you can continue to get credit in the future.
- Payday loan shops that offer check-cashing services act as a drawee for customers but charge a fee for the service.
- When coupons are used in a retail transaction, like at a grocery store, the retail outlet becomes the drawee. .
- A drawee is the person or other entity that pays the owner of a check or draft. The holder of the check is the payee and the check writer the drawer.
- I was the drawee and needed to take things out of the bank and give them to another person that day.
Meaning of Drawee & Drawee Definition