A bill of exchange is a written financial document that orders one party to pay a specific amount of money to another party at a predetermined date. It is commonly used in international trade to facilitate transactions between buyers and sellers. The document serves as a guarantee of payment, ensuring that the seller receives their money while the buyer can defer payment until the agreed date. In a typical transaction, the drawer creates the bill, directing the drawee to pay the payee. The drawee is usually a bank or a business that accepts the bill. Once accepted, the bill can be transferred to other parties, making it a flexible tool for managing credit and payments in commerce.