Legal Tender
LEE-gul TEN-der
/ˈliːɡəl ˈtɛndər/
Currency that cannot be legally refused in payment of a debt.
While it must be accepted for debts, businesses can refuse it for transactions if they state their policy beforehand (e.g., 'cashless store').
The story behind the word. The word 'legal' comes from the Latin 'legalis,' meaning 'of the law.' 'Tender' comes from the Old French 'tendre,' meaning 'to offer.' So, 'legal tender' is literally money that you are 'legally offering' to settle a debt, and it must be accepted by law. It's the law's way of saying, 'This money is good here.'
Word relationships
- official currency: Broader, refers to the money system; 'legal tender' specifies its debt-payment status.
Commonly confused with
- Promissory Note: A promissory note is a written promise to pay a specific sum of money, not a form of currency itself.
Collocations
- official legal tender
- recognized legal tender
- not legal tender
Example sentences
- "In most countries, banknotes and coins issued by the central bank are considered legal tender for all public and private debts." Explaining payment obligations.
- "Although a store may prefer card payments, they generally cannot refuse legal tender for goods or services unless specified." Discussing payment methods.
Memory hook
LEGAL TENDER is money that is 'LEGALLY' required to be 'TENDERED' (offered and accepted) for debts. Lawful offer
When not to use
Do not use 'legal tender' interchangeably with 'currency' if the legal enforceability for debt payment is not the specific point being made.
Fun facts
- In the UK, coins are only legal tender up to certain amounts (e.g., 20p coins are legal tender for amounts up to £10).
Related words
Explore more words
debt, bankruptcy, repudiate, liability, Purchasing power, Demand
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