letter of credit

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noun

an order issued by a banker allowing a person named to draw money to a specified amount from correspondents of the issuer.

an instrument issued by a banker authorizing a person named to make drafts upon the issuer up to an amount specified.

Origin of letter of credit

First recorded in 1635–45

Dictionary.com Unabridged Based on the Random House Unabridged Dictionary, © Random House, Inc. 2019

British Dictionary definitions for letter of credit

letter of credit

noun

a letter issued by a bank entitling the bearer to draw funds up to a specified maximum from that bank or its agencies

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

Collins English Dictionary - Complete & Unabridged 2012 Digital Edition © William Collins Sons & Co. Ltd. 1979, 1986 © HarperCollins Publishers 1998, 2000, 2003, 2005, 2006, 2007, 2009, 2012