USANCE Meaning and
Definition
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Usance is a term used in finance and commerce that refers to the time period specified in a bill of exchange or promissory note during which the payment must be made by the buyer to the seller. It indicates the agreed-upon credit period allowed for payment after the delivery or acceptance of goods or services. Usance is commonly expressed as a specific number of days, and the payment is typically expected to be made within this duration.
In international trade, usance is particularly significant as it affects the payment terms in letters of credit, which are often used to secure transactions between parties in different countries. These letters of credit may specify a certain usance period, and the buyer must fulfill the payment obligation within this time frame to ensure that the transaction is completed successfully.
Usance also plays a role in determining the interest rate charged on loans. Lenders may provide credit to borrowers with interest rates that are based on usance, meaning that the borrower will be charged based on the number of days the loan remains unpaid.
Overall, usance refers to the agreed-upon time period for payment in financial and commercial transactions, providing a framework for the settlement of debts and obligations between parties involved.
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Proper employment; the period after date allowed for the payment of a bill of exchange according to commercial custom.
Etymological and pronouncing dictionary of the English language. By Stormonth, James, Phelp, P. H. Published 1874.
Common Misspellings for USANCE
- ysance
- hsance
- jsance
- isance
- uaance
- uzance
- uxance
- udance
- ueance
- uwance
- usznce
- ussnce
- uswnce
- usqnce
- usabce
- usamce
- usajce
Etymology of USANCE
The word "usance" derives from the Old French term "usance" or "usancement", which comes from the Latin word "usus" meaning "use" or "custom". It entered English in the 14th century and initially referred to the customary period for the settlement of a bill of exchange, which was typically three months. Over time, "usance" came to represent the interest charged or earned on funds lent between merchants, particularly for international trade transactions. The word's meaning has evolved to also encompass the customs, practices, or accepted norms of business in various contexts.
Similar spelling words for USANCE
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