What is Field 42M: Mixed Payment?
Field 42M: Mixed Payment specifies the payment dates, amounts and/or method for their determination in a documentary credit which is available by mixed payment.
This is an optional field.
Mixed payment is not covered under the letter of credit rules. But parties can utilize a letter of credit which is available by mixed payments.
There are 3 main scenarios exists in a mixed payment letter of credit:
- Scenario 1: The beneficiary receive an advance payment before the shipment and remaining amount will be payable against the shipping documents,
- Scenario 2: Some of the contract amount is payable against the shipping documents and the remaining amount will be paid after the shipment such as installation of the machinery etc.,
- Scenario 3: Mixed payment consists of both advance payment, payment against the shipping documents and payment after the shipment. (Option 3 is the combination of Option 1 and Option 2)
Mixed Payment Example:
- 50 percent of the total lc value payable at sight as an advance against presentation of simple invoice.
- 40 percent of the total lc value payable at sight against presentation of stipulated documents under field 46A.
- 10 percent lc value payable at sight against presentation of following documents: commercial invoice for 10 percent of lc value completion of installation certificate issued by beneficiary and to be duly counter signed by applicants authorized signatory , whose signature follows by courier.
Field 42M: Mixed Payment Details:
This field specifies the payment dates, amounts and/or method for their determination in a documentary credit which is available by mixed payment.
Either fields 42C and 42a together, or field 42M alone, or field 42P alone may be present. No other combination of these fields is allowed