Kategorier: Alle - assurance - documentation - payment - protection

af Luis Ruiz 4 år siden

197

L/C

A letter of credit (L/C) is a financial instrument used in international trade to ensure secure payment between buyers and sellers. It is more expensive than other payment methods but offers a high level of security.

L/C

L/C

Advantages/Disavantages

Sellers
Can have problems

discrepancies documents presented

can cause issuing bank cancel L/C

try modify terms of L/C

interruption in operations

unacceptable costs

impossible delivery times

Buyer
no payment before
can obtain better terms & prices
experts support
reduce risks
High degree assurance

Goods will be delivered

documentations

Draft or Bill Exchange(Negotiable instrument to be given to the bank in order to get paid)
Consular Invoice or Legalized Commercial Documents
Health Certificate of Phytosanitary Certification
Insurance Certificate (proof of Insurance)
Inspection Certificate (proof of quality)
Certificate of Origin (proof of origin)
Packing List (proof of packing)
Bill of Landing (proof of shipment)
Commercial Invoice (proof value)

OWN OPINION

More expensive than other methods
Very secure method payment

BENEFICARY

DEFINITION

offers protection
seller
buyer
the issuing bank irrevocably
promises to pay the seller
payment mechanism