A draft drawn on a bank that is payable on demand is known as what?

A draft drawn on a bank that is payable on demand refers specifically to a check. A check is a written order directing a bank to pay a specified sum of money from the account holder's account to the person named on the check or to the bearer of the check. The hallmark of a check is that it is payable on demand, meaning that upon presentation to the bank, the funds should be available for withdrawal.

In contrast, while a payment order is a directive to a bank to debit one account and credit another, it has specific conditions and isn't necessarily a document like a check. A bill of exchange involves a transaction where one party orders another to pay a specific sum, which may not always be on demand. A promissory note is a written promise from one party to pay another party a certain amount at a future date and does not function as a demand instrument in the same way as a check does.