A short-term credit instrument created by a nonfinancial firm and guaranteed by a bank as to payment. Acceptances are traded at discounts from face value in the secondary market on the basis of the credit quality of the guaranteeing banks. These instruments have become a popular investment for money market funds. Also called acceptance.
Main Entry: banker's acceptance Function: noun : a short-term credit instrument issued by an importer's bank that guarantees payment of an exporter's invoice
