Enhancing financial literacy with FinGramota
We offer the most optimal settlement method that saves time and money by reducing risks and obtaining financing through a documentary letter of credit.
A documentary letter of credit is an irrevocable commitment by the issuing bank to pay the beneficiary (Seller) the amount for the presented documents, provided that all conditions of the letter of credit are met.
issuance of a reliable payment instrument in favor of the Seller without diverting the Buyer's financial resources from circulation
the bank will make payment to the Seller only after receiving documents that comply with the terms of the letter of credit
opportunity to obtain financing from various sources, including credit lines in foreign banks and international financial organizations
ability to control the timing of goods shipment
possibility to provide for pre-shipment inspection of goods for compliance with certain quality standards, etc.
the bank monitors the transaction, protects the Buyer's interests, and makes payments under the letter of credit without the direct involvement of the Buyer
existence of a solid bank payment obligation, independent of the Buyer's solvency
possibility of receiving payment before the Buyer receives the goods
opportunity to offer Buyers more competitive trading terms when issuing a letter of credit with deferred payment
participation in the transaction as an intermediary without using one's own financial resources
100% cash coverage or collateral (real estate, movable property, equipment, funds in a savings account)
Project or copy of the foreign trade contract
Original application for issuing a letter of credit
The Buyer applies to the Bank to issue a letter of credit in favor of the Seller
The Importer's Bank issues and advises the letter of credit in favor of the Seller through its own or any other foreign bank
The Seller ships the goods and prepares documents for payment in accordance with the terms of the letter of credit
The Buyer's Bank or a Foreign Bank makes the payment against the submitted documents