Letters of Credit

A Letter of Credit is a written undertaking by a financial institution that promotes international trade by providing a conditional but irrevocable guarantee on account of an importer/buyer in favour of an exporter / seller. Credits are separate transactions from any pre-existing contractual relationship between the accreditor (importer) and the beneficiary (exporter) of the Letter of Credit.

• Comfort to the beneficiary that once they receive the credit, payment will be received (provided he complies with the L/C terms)
• The provision of pre-shipment finance (on the strength of the L/C only, or on the strength of a specific advance authority contained therein) by the beneficiary's bankers
• The provision of finance whilst the goods are afloat
  Post-shipment finance
• Occasionally, L/C's are used, not only in connection with the shipment of goods, but are also (mostly in the form of revolving L/C's) for the payment of disbursements, as a form of guarantee by an overseas bank (stand-by credit), etc.

• Corporates

• Latest signed year end financial accounts
• Latest management accounts including debtors age analysis, creditors age analysis and stock age analysis
• 12 months Cashflow projection
• Business plan
• KYC documentation