Trust Receipt


Also found in: Financial, Acronyms.

Trust Receipt

A document by which one individual lends money to purchase something and the borrower promises to hold the item for the benefit of the lender until such time as the debt is paid.

A trust receipt was a device used before the adoption of the Uniform Commercial Code (UCC); it is now governed by Article 9 of the UCC, which concerns Secured Transactions. A trust receipt stated that the buyer had possession of the goods for the benefit of the financier. Currently there ordinarily must be a security agreement, together with the filing of a financing statement, to protect a lender's interest in goods purchased on credit by a buyer.

References in periodicals archive ?
Goods are released to the importer under trust receipts, meaning that the importer can use the goods immediately, but they belong to the bank until the importer settles the loan.
Taxable income of a trust includes trust receipts subject to income tax.
Espina, who succeeded resigned PNP Director General Alan Purisima but only in an acting capacity, was also allowed to release funds from the PNPs Agency Reserved Fund, allocate funds from its Trust Receipts and sign checks in behalf of the PNP.
In most cases, SMEs in trading and manufacturing get bank facilities -- mainly letter of credit (LCs) and trust receipts (TRs) -- at between 6 to 14 per cent annum," said Jitendra Gianchandani, chairman of Jitendra Consulting Group (JCG).
The financing includes before and after shipping facilities, loans against trust receipts, discounted bills, payments for receivable amounts and discounted export bills.