A Letter of Credit is an undertaking issued by a bank (issuing bank) for the account of the buyer (the applicant) to pay the beneficiary (the seller), provided that the terms of the Letter of Credit are complied with.
It is generally used to facilitate the importation or exportation of goods and services as well as local trade.
- As per tariff guide
- Safe and secure way to import or export
- Competitive pricing
- The bank acts as intermediary between the importer and exporter to guarantee payment
- Flexible security requirements i.e. log books, title deed, residential license, debentures, shares, Treasury Bills, etc
- Credit Life Insurance
- For both account and non-account holders
- Must be able to secure the letters of credit with 100% cash cover or equivalent
- Permanent business locations
- Maximum period, 12 months (1 year)