Bill Discounting ? Can any one please tell me the meaning of Bill Discounting in Financial / Banking terms.................

4 years ago Report Abuse

narasimhan v Best Answer - Chosen by Asker

Bills discounting is nothing but a type of Credit Facility extended by the Bank. For example if you have raised a Bill on your customer for about 1.00 lacs& if you have the discounting facility at your bank you can discount the same. First of all you hv to negotiate the bill thro' your banker to your customer's Banker. Even before realisation/payment made by your customer you account will be credited to 80% or so based on the agreemetn with you Banker. Ofcourse Charges applies. Source(s): As soon as your customer effect the payment Credit already extended by your Banker will be taken back. If the customer isses a chq you have to deposit the chq where you have discounted the Bill though you may hv more than one Bank account. Its a short term Credit extended by the Bank where you Bill is the sole authority to efect that credit. In case your Bill was dishonoured by you customer again you account will be debited with interest + chgs to the extent of Credit already earned based on that Bill. There are various types of short term credit facility extended by the Banker viz., Letter of Credit,Guaranteeetc& so on .

Discover Questions in Other - Business & Finance

Craigslist Help? Raising an agreed price? If a price of a product is Rs.1000 after 20% discount. How do we calculate its original price before discount? Need help with my accounting homework? How to get a job at hollister?

Community Guidelines . Tell us what you think.Terms of Service . Copyright © 2009 Yahoo! Inc. Copyright/IP Policy .Privacy Policy .Answers International ArgentinaAustraliaBrazilCanadaChinaFranceGermanyHongKongIndiaIndonesiaItalyJapanMalaysiaMexico NewZealandPhilippinesQuebecSingaporeSouthKoreaSpainTaiwanThailandUnitedKingdomUnitedStatesVi etnamenEspañol Yahoo! does not evaluate or guarantee the accuracy of any user content on Yahoo! Answers. Help us improve Yahoo! Answers. Click here for the Full Disclaimer. All Rights Reserved.