An accepting house is a financial institution that provides a range of services, including the acceptance of bills of exchange, the issuance of letters of credit, and the provision of foreign exchange services. The term is widely used in the banking and finance industry, and it is important to understand its meaning and significance.
Definitions
An accepting house is a financial institution that specializes in accepting and endorsing bills of exchange, which are negotiable financial instruments that are used to facilitate international trade. The accepting house provides a guarantee that the bill will be paid at maturity, which helps to reduce the risk for the seller.
Origin
The term “accepting house” dates back to the 18th century, when it was used to describe a type of financial institution that specialized in accepting bills of exchange. These institutions played a critical role in facilitating international trade by providing a means of payment that was widely accepted and trusted.
Meaning in different dictionaries
According to the Oxford English Dictionary, an accepting house is “a bank or other financial institution that accepts bills of exchange, and provides other financial services.” The Merriam-Webster Dictionary defines it as “a bank or other financial institution that accepts and guarantees payment of bills of exchange.”
Associations
Accepting houses are typically associated with international trade, as they provide a means of payment that is widely accepted and trusted. They are also associated with risk management, as they help to reduce the risk of non-payment for sellers.
Synonyms
Some synonyms for accepting house include bill broker, bill discounter, and bill acceptor.
Antonyms
There are no direct antonyms for accepting house, as it is a specialized term that describes a specific type of financial institution.
The same root words
The root words of accepting house are “accept” and “house.” “Accept” means to receive something willingly, while “house” refers to a building or institution. Together, they describe a financial institution that is willing to receive bills of exchange and provide financial services.
Example Sentences
- The accepting house provided a letter of credit to facilitate the import of goods from overseas.
- The seller was able to reduce their risk by using an accepting house to guarantee payment of the bill of exchange.
- The accepting house endorsed the bill of exchange, making it negotiable and widely accepted.