GlossaryEN1 min readUpdated: Jun 18, 2026
settlement account
A settlement account allows transport and logistics partners to pool mutual charges and reconcile them periodically rather than settling each invoice individually.
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Source: https://www.lexico.com/definition/settlement_account
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Definition & Explanation
A settlement account allows transport and logistics partners to pool mutual charges and reconcile them periodically rather than settling each invoice individually. Freight charges, customs fees, terminal handling surcharges, and ancillary costs are posted continuously to the account, with the net balance cleared daily, weekly, or monthly. The arrangement reduces administrative overhead significantly and provides liquidity headroom in high-volume trading relationships. It requires a master agreement between the parties defining credit limits, eligible charge types, and reconciliation cycles. In customs contexts, a settlement account is often linked directly to a customs deferment facility.
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