Dictionary of Banking Terms: payable through draft
payable through draft
draft payable through a designated bank, drawing funds from the issuer's own account. The bank, whose name is printed on the face of the draft, verifies neither the signature nor the endorsement, which is the responsibility of the issuer. Payable through drafts are used by corporations to pay freight bills, or by insurance companies to settle claims. A credit union share draft account, a check-like negotiable instrument, also is a payable-through draft, often cleared through a correspondent bank.
