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Meaning of letter of credit

let'ter of cred'it

Pronunciation: [key]
  1. an order issued by a banker allowing a person named to draw money to a specified amount from correspondents of the issuer.
  2. an instrument issued by a banker authorizing a person named to make drafts upon the issuer up to an amount specified.
Random House Unabridged Dictionary, Copyright © 1997, by Random House, Inc., on Infoplease.