Documentary Letters of Credit
With Documentary Letters of Credit (LCs) the issuing bank, i.e. the bank of the buyer/importer, undertakes the obligation to pay the seller/exporter on condition that the exporter fulfils the terms of the LC and presents the required documents that prove the transaction has been completed.
Standby Letters of Credit
With Standby Letters of Credit (SBLCs), the issuing bank undertakes the irrevocable commitment to pay a specific amount to the beneficiary in the event the LC applicant fails to fulfil an obligation arising from a specific agreement.
Who they are addressed to
Documentary Letters of Credit are addressed to businesses primarily engaged in imports.
Standby Letters of Credit are primarily addressed to businesses that are engaged in imports or participate in international tenders.
What you gain as an importing business
- Get access to commercial credit or extension of existing credit by the seller.
- Secure payment or the issuing bank’s obligation to effect deferred payment, following shipment of the goods and compliant presentation of the shipping documents.
What you gain as an exporting business
- Eliminate country and foreign bank risks through the addition of confirmation.
- Eliminate buyer risk.
- Offer extended commercial credit to the buyer.
- Use Letters of Credit as a financing instrument.
How to find out more
For further information about the tools, the conditions for using them and the application process, contact our dedicated international trade advisors by email at:
Trade_and_Supply_Chain_Finance@eurobank.gr