letter of credit
Americannoun
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an order issued by a banker allowing a person named to draw money to a specified amount from correspondents of the issuer.
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an instrument issued by a banker authorizing a person named to make drafts upon the issuer up to an amount specified.
noun
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a letter issued by a bank entitling the bearer to draw funds up to a specified maximum from that bank or its agencies
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a letter addressed by a bank instructing the addressee to allow the person named to draw a specified sum on the credit of the addressor bank
Etymology
Origin of letter of credit
First recorded in 1635–45
Example Sentences
Examples are provided to illustrate real-world usage of words in context. Any opinions expressed do not reflect the views of Dictionary.com.
In March, to make up for the lost payments, the landlord used a letter of credit deposited by Twitter for $968,000.
From Washington Times • Jun. 15, 2023
The letter of credit did not exist, the SEC would later tell a court.
From Seattle Times • Jan. 20, 2023
A letter of credit could be issued from one bank branch at a certain amount, redeemable only by the account owner.
From Textbooks • Jan. 1, 2020
But she gave no details and would not confirm that the centerpiece of the negotiation was the $15 billion letter of credit.
From New York Times • Sep. 2, 2019
I wrote home a few days ago for them to send me a letter of credit on the bankers here.
From Mildred Arkell, Volume II (of 3) A Novel by Wood, Mrs. Henry
Definitions and idiom definitions from Dictionary.com Unabridged, based on the Random House Unabridged Dictionary, © Random House, Inc. 2023
Idioms from The American Heritage® Idioms Dictionary copyright © 2002, 2001, 1995 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company.
