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TeachMeFinance.com - explain Letter of delegation historic definition... Letter of delegation -- A letter conferring authority on another to collect an amount due. For instance, a merchant in New York may have shipped goods to a merchant in Chicago. The New York merchant authorizes (delegates) a bank in New York to collect payment for the goods and confers the authority to do so in a letter of delegation, so-called, which is accompanied by the bill of lading. The bank in New York forwards the letter and bill of lading to the bank in Chicago which acts as its correspondent there and which makes the collection. Again, a merchant in New York may have shipped goods to a merchant in London. The New York merchant authorizes (delegates) a dealer in foreign exchange in New York to collect payment for the goods and confers the authority to do so in a letter of delegation, which is accompanied by the bill of lading, policy of insurance, etc. The dealer in exchange transfers the letter with the bill of lading, etc., to his correspondent in London who makes the collection. About the author Mark McCracken Author: Mark McCracken is a corporate trainer and author living in Higashi Osaka, Japan. He is the author of thousands of online articles as well as the Business English textbook, "25 Business Skills in English". Copyright © 2007 by Mark McCracken, All Rights Reserved. TeachMeFinance.com is an informational website, and should not be used as a substitute for professional financial or legal advice. TeachMeFinance.com and its owner recommend consultation with a professional financial advisor prior to any investment or financial decision. Please read our disclaimer.