Meaning of “discount rate” in the English Dictionary

"discount rate" in Business English

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discount ratenoun [ C ]

uk us

FINANCE, BANKING the rate of interest that a country's central bank charges for lending money to other banks:

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” from the Cambridge Business English Dictionary © Cambridge University Press)