Bank-discount definition

Interest deducted in a lump sum by a bank from a loan when the loan is made: it is computed from the date of the loan to the date of the final payment on the basis of the original amount of the loan.

The interest on a loan computed in advance and deducted at the time the loan is made.

The definition of bank discount means the interest on a loan that is removed from the loan amount at the point that loan is made.