In banking, what does the term “payer” refer to?

The term “payer” in banking specifically refers to the individual or entity that writes a check or makes a payment. This is because the payer is the one responsible for providing the funds, whether it be through a check, electronic transfer, or other payment methods. The act of writing a check involves the payer authorizing a transfer of funds from their account to the recipient.

In contrast, the recipient of the check would be the "payee," which clarifies the roles in a transaction. The bank itself or its employees are not considered payers; their function revolves around facilitating and processing transactions rather than being the source of the funds. Understanding this terminology is essential for distinguishing between the parties involved in financial transactions.