bill of exchange

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Related to bills of exchange: promissory note

Bill of exchange

General term for a document demanding payment.

Bill of Exchange

A document requiring payment by one party to another for a good or service the party demanding payment provided. See also: Receipt.

bill of exchange

a FINANCIAL SECURITY which is used to extend business CREDIT for a limited time period. The lender draws up a bill of exchange for a specified sum of money payable at a given future date, usually three months hence, and the borrower signifies his agreement to pay the amount involved by signing (i.e. accepting) the bill. In addition, a borrower will often arrange for a bill to be guaranteed by an ACCEPTING HOUSE, which in return for a fee will agree to repay the debt should the borrower be unable to do so. Most bills are in fact ‘discounted’ (i.e. bought from the drawer) by a DISCOUNT HOUSE for an amount less than the face value of the bill (the difference between the two sums being the interest charged). The bill may then be held until maturity or sold at a lower price (‘rediscounted’) to another discount house, or, more commonly, on-sold to the COMMERCIAL BANKS. See DISCOUNT, DISCOUNT MARKET, REDISCOUNTING, INTEREST RATE.

bill of exchange

a FINANCIAL SECURITY representing an amount of CREDIT extended by one business to another for a short period of time (usually three months). The lender draws up a bill of exchange for a specified sum of money payable at a given future date, and the borrower signifies his agreement to pay the amount indicated by signing (accepting) the bill. Most bills are

‘discounted’ (i.e. bought from the drawer) by the DISCOUNT MARKET for an amount less than the face value of the bill (the difference between the two constitutes the interest charged). Bills are frequently purchased by the COMMERCIAL BANKS to be held as part of their RESERVE ASSET RATIO. See DISCOUNT, ACCEPTING HOUSE, DISCOUNT HOUSE.

References in periodicals archive ?
As one account puts it: "He carried the art of kiting checks and bills of exchange to a high degree of perfection.
It had already been partly replaced in 1828 by a borrowing and discount facility, whereby 100 000 speciedaler in silver coins and 150 000 speciedaler in banknotes the debitor, in this context were made available for discounting bills of exchange.
This is how deals are closed, by compensating some debts with others and through the signature of bills of exchange issued to different places.
Companies that are supplying goods abroad on a regular basis or are simply dealing with a large ad hoc transaction in-volving a non-UK customer should look into the method of payment by bills of exchange, with a view to taking some of the risk out of their business.
The chapters on bills of exchange provide the most lucid explanation in any language of these complex financial instruments.
Although signed bills of exchange are a good method of payment for transactions within a given country, a bill of exchange used to pay foreign vendors is another matter.
seeking to recover alleged losses of approximately $56 million from a number of parties involved in international trade transactions that gave rise to bills of exchange financed by various Korean banks but not ultimately paid.
Another problem is the backlog of checks and bills of exchange that cannot be paid, meaning that business transactions worth an estimated 6 billion euros have been frozen.
Exchanging for bills of exchange is illicit when more than the fair salary is taken or less than the fair salary is given for lending on credit or advancing, and restitution is required .
175) She explains the large extension of credit in the countryside in the 1770s and 1780s, when promissory notes issued to local suppliers replaced bills of exchange.
This includes letters of credit, negotiable instruments such as promissory notes and bills of exchange, syndicated loans linked to trade deals, export credit loans and other trade finance-related products.