Benefits of A Letter of Credit :

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To The Exporter/Seller


Letters of credit open doors to international trade by providing a secure mechanism for payment upon fulfilment of contractual obligations.


A bank is substituted for the buyer as the source of payment for goods or services exported.


The issuing bank undertakes to make payment, provided all the terms and conditions stipulated in the letter of credit are complied with.


Financing opportunities, such as pre-shipment finance secured by a letter of credit and/or discounting of accepted drafts drawn under letters of credit, are available in many countries.


Bank expertise is made available to help complete trade transactions successfully.


Payment for the goods shipped can be remitted to your own bank or a bank of your choice.




To the Importer/Buyer


Payment will only be made to the seller when the terms and conditions of the letter of credit are complied with.


The importer can control the shipping dates for the goods being purchased.


Cash resources are not tied up.

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Benefits of A Letter of Credit
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