Letter of Credit is an undertaking issued by the buyer's bank to pay a specified sum of money to the seller provided credit conform documents evidencing the. A letter of credit is a letter written by a bank authorizing another bank to pay someone a sum of money. Letters of credit are often used by importers and. A Letter of Credit is an undertaking by the bank issuing it to pay the beneficiary of the credit.
As one of the most common forms of letters of credit, commercial letters of credit are when the bank makes payment directly to the beneficiary or seller. Some buyers must pay the bank up front or allow the bank to freeze funds held at the bank. By using banks as intermediaries, you alleviate all of these concerns. The specified documents are often bills of lading or other 'documentary intangibles' which 'A' and 'B' have previously specified in their original contract. Legal counsel: A firm that advises applicants and beneficiaries on how to use letters of credit. The what is a letter of credit for of documents that may be requested by the applicant is vast, and varies considerably by country and commodity. The bank will only issue a letter of credit if the bank is confident that the buyer can pay.
: What is a letter of credit for
What is a letter of credit for
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