Foreign Draft

A foreign draft is an alternative to foreign currency. A foreign draft is a bank draft which is drawn on a financial institution in the country of currency. They can be purchased at commercial banks and usually have a fee depending on the institution and the type of account you hold.

A foreign draft is basically a bill of exchange that is drawn in one country and made payable in another country. 

A bill of exchange is a written order that is used to, mostly in international trade, that binds one party to pay a fixed sum of money to another party on demand, or at a predetermined date.

So, a foreign draft is a tool that facilitates the transfer of funds that originate in one country, as one currency into another currency, in another country, either on demand, or at a predetermined rate. 

Foreign drafts are generally used to send money to a foreign country. Foreign drafts mitigate the effects of exchange fees, and bank routing delays, so this method is cheaper and more efficient than sending the currency itself. It also enables the receiver to access the funds quicker than if a draft or check were written in U.S. currency. Further, it requires less information (such as the routing transit number) on the purchasers part than a wire transfer.