What is a draft called that is payable at a specified future date?

A draft that is payable at a specified future date is known as a time draft. This type of draft allows the payee to receive their funds only after a given period, which is agreed upon when the draft is created. Time drafts are often used in commercial transactions where the buyer may need time to pay after receiving goods or services, thus providing a structured payment schedule.

In practice, time drafts typically involve an agreement between the parties involved, providing clarity on when the payment will occur. This is advantageous for both the payer, who can manage cash flow, and the seller, who has assurance of payment at a predetermined time.

While bank acceptances and certified checks have specific uses within financial transactions, they do not pertain to drafts that are payable at a future date. Demand drafts, on the other hand, must be paid on demand or presentation, contrasting with the delayed payment structure of time drafts.