discount rate

noun [C]

Definition

› FINANCE, BANKING the rate of interest that a country's central bank charges for lending money to other banks: cut/lower/raise the discount rate a cut/reduction/increase in the discount rate The central bank slashed its official discount rate, at which it lends to commercial banks, to prevent the economy from sliding into recession.

› FINANCE, ACCOUNTING a rate of interest that you use to calculate the present value of an amount of money that you receive or pay in the future: In terms of current market prices a 10% discount rate would imply a yield of 10.08% over 30 days.

› (also bill rate) FINANCE the rate by which the price of a bill of exchange is reduced if it is bought before its payment date

› COMMERCE a reduced priced that is offered to customers if they buy large quantities of products or services or if they pay a bill by an agreed date

(Definition of discount rate noun from the Cambridge Business English Dictionary © Cambridge University Press)