Question

Payee of a bill of exchange is a person __________.

• A. to whom the bill of exchange is payable
• B. who has accepted the bill of exchange
• C. a person who draw the bill
• D. to whom the bill is endorsed

Answer 1

The correct option is A to whom the bill of exchange is payable

Payee is a party to the bill of exchange. Payee is the person to whom the payment is to be made. The drawer of the bill himself will be the payee if he keeps the bill with him till the date of its payment. The payee may change in the following situations:

(a) In case the drawer has got the bill discounted, the person who has discounted the bill will become the payee.

(b) In case the bill is endorsed in favour of a creditor of the drawer, the creditor will become the payee.