Home Letter of Credit Basics

Letter of Credit Basics

Understanding main concepts of letters of credit and most frequently used terms related to L/C payments.

partial shipment and transshipment

Comparison Between the Partial Shipment and Transshipment

Definition of Transshipment: Transhipment means unloading from one means of conveyance and reloading to another means of conveyance during the carriage as enrouted in...
Bill of Lading Stating That All Originals Must be Surrendered

L/C Demands a B/L Stating That All Original B/Ls Must be Surrendered

A negotiable bill of lading is a bill of lading where the consignee’s name is preceded by the words “to order,” thus allowing the...
joker clause letter of credit

How to Handle a Letter of Credit Which Contains a Joker Clause?

"A credit should not require presentation of documents that are to be issued, signed or countersigned by the applicant" says International Standard Banking Practice...
payment types in a letter of credit transaction

Availability of Letters of Credit

According to letter of credit rules, a credit must state whether it is available by sight payment, deferred payment, acceptance or negotiation. (UCP 600...
Letter of Credit Glossary

Letter of Credit Glossary – Most Frequently Used L/C Terms

You can find most frequently used letters of credit terms on this page. Please click links for further explanations. About Means a tolerance of...
What does duplicate, triplicate, quadruplicate, quintuplicate etc. mean?

What Does Duplicate, Triplicate Mean in a Letter of Credit?

Letters of credit have a special jargon. If you are not familiar with the L/C language, you may not be able to understand what letter...
payment methods and bic and iban

What is Business Identifier Code (BIC) and International Bank Account Number (IBAN)?

Whatever your payment method would be, cash in advance, open account, cash against documents, letter of credit or bank payment obligation, you need to...
Freight Forwarder’s Bill of Lading Not Acceptable

Freight Forwarder’s Bill of Lading Not Acceptable

Some issuing banks add an additional condition to the letters of credit they have issued, indicating that freight forwarder's bill of lading is not...

Top 10 Letter of Credit Discrepancies

Discrepancy can be defined as an error or defect, according to the issuing bank, in the presented documents compared to the documentary credit, the...
high letter of credit fees and commissions

How to Deal with High Banking Commissions under Letters of Credit?

No matter how many advantages letters of credit have, they have one big disadvantage. They are expensive. As a result, you should understand your costs...
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