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Glite Dictionary
bill of exchange

bill of exchange

7.5
A written order telling one person or bank to pay money to another at a set time
  • noun
  • /bɪl əv ɪkˈsʌɪndʒ/
  • Formal
translation icon : letra de cambio
  • Simple donative promises would be degraded into bills of exchange, and the gifts made to keep such promises would be degraded into redemptions of the bills.

Examples

  • European merchants were already using modern business methods: credit, loans, checks, bills of exchange, double-entry bookkeeping, insurance of goods in transit.

    Academic text (1992)

  • You are to use this bill of exchange for the purchase of the new equipment.

    The Adventurer: The Curse of the Midas Box (2013)

  • The seller provided a bill of exchange that instructed the bank to pay the buyer upon delivery of the goods.

  • Using a bill of exchange allows businesses to manage cash flow and credit effectively during transactions.

  • The merchant received a bill of exchange informing him that payment would be made in full next month.

Synonyms

draft
vsbill of exchange
  • Specialized
7 5.8

A written order telling a bank to pay money to someone

directs payment to a named third person and sets the payment time
time bill
vsbill of exchange
  • Archaic
9.1

A written order to pay money on a fixed future date

is the broader written instruction that can specify many payment timings
order of payment
vsbill of exchange
  • Formal
4.8

Formal paper that tells a bank to pay a named person or company a set amount of money

adds the requirement that payment occur at a particular set time
sight bill
vsbill of exchange
  • Formal
9.3

A written order that the bank or buyer must pay immediately when shown

sets payment for a prearranged time instead of immediate presentation payment
foreign bill
vsbill of exchange
  • Specialized
7.6

A written order that asks a bank to pay money in another country

applies generally without specifying international drawing or payment

How Secure

government bond
  • Specialized
14 2.7
banker's draft
  • UK
1 5.7
banker's acceptance
  • Specialized
8.1
bill of exchange
  • Formal
7.5
promissory note
  • Specialized
6 7.0

Surface Forms

bill of exchange singular
bills of exchange plural

Morphology

bill + of + exchange

The parts 'bill' (a payment/document) and 'exchange' (transfer/change of money) give a general hint that this is a financial document, but they do not yield the specific legal sense of a negotiable instrument ordering payment to a third party at a set time. Because the phrase is a technical banking term whose precise obligations and mechanics are not predictable from the constituents, it is partly but not fully transparent to an average B1 learner.

Etymology

The noun bill of exchange may come from old trade where a paper called a bill told one person or bank to 'pay' another. Traders would 'exchange' that paper instead of sending cash far away, so the paper acted as an order and a promise to pay, which is why today the phrase means a written order to pay a set sum at a set time.