A payee is a person or entity that receives payment in a financial transaction. This can occur in various contexts, such as when someone writes a check or makes a digital payment. The payee is typically named on the payment document, indicating who should receive the funds. In a business setting, the payee could be a vendor, contractor, or service provider that has completed work or delivered goods. Understanding the role of the payee is essential for proper record-keeping and ensuring that payments are made accurately and on time.