Abiblo Economics - Acceptance

​Acceptance
Acceptance is when the signature of someone is added to a bill of exchange. Thus it means that you accept the liability to pay the bill at maturity when the original signatory default in payment.
 
The acceptor is taking the risk and makes a charge for this. 
 
Acceptance of bill of exchange by a credible financial institution such as merchant bank, makes it the bill safer to hold and easier to sell.