Letters of Credit
A letter of credit is a conditional bank credit guaranteeing that a price, goods or services will be provided to the importer when the documents guaranteeing the delivery of goods or services are submitted within a designated period. You can safely perform your international trade transactions with letters of credit.
- Regarded as a guaranteed payment instrument in international trade, the letter of credit is a commonly preferred method of payment which protects the exporter as well as the importer.
- The importer is protected because the payment will not be transferred to the other party before the delivery of goods or completion of services.
- Upon the delivery of goods or completion of services, the exporter can receive the payment by submitting the documents in compliance with the terms of the letter of credit.