Letter of credit

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LETTER OF CREDIT

Already at the conclusion of the contract, ensure that payment and business risks are as small as possible.

Choose a letter of credit, which is an instrument of insurance and, at the same time, an instrument of payment in domestic and international transactions.

You reduce the risk of non-payment when concluding deals.

Enhance the competitiveness of your company and increase your sales.

Advantages:

A documentary letter of credit protects the interests of both parties in the business relationship and offers a high level of insurance as a payment instrument, as it transfers the risk of non-payment to the bank.

It assures the buyer of the goods that the bank will pay the amount specified in the documents proving that the goods were shipped on time, in the agreed manner, to the agreed address, and in the appropriate quantity.

It guarantees to the seller that they will receive payment for the goods sent within the agreed deadline, provided they submit documents that comply with the terms of the letter of credit.

Types of Letters of Credit

Documentary letter of credit

It is the most widely used letter of credit and represents an irrevocable commitment of the buyer's bank (Issuing Bank) to pay the seller/contractor (Beneficiary) the value equivalent to the amount specified in the documents presented to the Issuing Bank or to the Nominated Bank, provided that the documents comply with the terms of the letter of credit.

Stand by L/C

A letter of credit that is similar in substance to a Bank Guarantee and can act as a substitute for the latter. Its use is recommended where business partners cooperate regularly and where regular delivery of goods over a certain period of time is involved. The seller uses a standby letter of credit only as insurance if the buyer fails to meet their payment commitment on time, as the seller can request payment via the standby letter of credit only after failing to collect payment from the buyer directly within the agreed time.

Transferable L/C

This type of letter of credit is used primarily when you act as an intermediary between the seller and the buyer. As the Beneficiary of a transferable letter of credit, you can make certain transactions without having to use your own funds or having your bank provide financing.

Request for import letter of credit in the online bank Bank@Net com

You can also send a request for an import letter of credit quickly and easily using the form in the online bank Bank@Net com.

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