How does a banker's acceptance work?

A banker’s acceptance works much like a post-dated check, which is simply an order for a bank to pay a specified party at a later date. If today is Jan. 1, and a check is written with the date "Feb. 1," then the payee cannot cash or deposit the check for an entire month. This can be thought of as a maturity date for a claim on another's assets.

Is a banker's acceptance an asset?

Yes, a banker’s acceptance is an asset. It is a type of short-term promissory note that represents a promise by a bank to pay a specified amount at a future date. Bankers’ acceptances are commonly used in international trade to facilitate the payment of goods and services. 2. What is a banker’s acceptance vs. commercial paper?

How do I get a banker's acceptance?

Banker's acceptances can be created as letters of credit, documentary drafts, and other financial transactions. If you are trying to obtain an acceptance, approach a bank with which you have a good working relationship. You need to be able to prove or offer collateral against, your ability to repay the bank at a future date.