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COMMERCIAL BILLS

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Commercial Bills are a negotiable instrument and have the same features like Bills of Exchange. In other words, it is a negotiable instrument which is being accepted by buyer for obtaining goods or services on credit. 

The most common practice is that the seller who gets the accepted bills of exchange discounts it with the Bank or financial institution or a bill discounting house and collects the money (less the interest charged for the discounting).

A commercial bill facility is a flexible credit facility which can give a company a short or long – term injection of cash to finance an individual export contract or general export growth. The volume of bills both inland and foreign, which is discounted/accounted, forms a substantial part of the total scheduled commercial bank credit.

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