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.

To Order and Blank Endorsed Bill of Lading

To Order and Blank Endorsed Bill of Lading

Bill of lading, which is a transport document used in international trade, is an authentic receipt delivered by a carrier, confirming that the goods...
Approval Basis

Approval Basis

Definition: Approval basis is a letter of credit term used in situations where the beneficiary could not prepare the documents according to the letter...
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...
stale documents

Stale Documents

Some letters of credit indicate that stale documents are not acceptable. In rare circumstances letters of credit may also indicate that stale documents are...
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...
video

Advantages and Disadvantages of Letters of Credit

Letter of credit is one of the payment methods in international trade. Just like other payment methods it has certain advantages and disadvantages. Advantages of...
How to determine date of shipment on a Bill of Lading

How to Determine Date of Shipment on a Bill of Lading?

Date of shipment is one of the key definitions in a letter of credit transaction. It is used to determine whether shipment made on...
how does an import letter of credit workvideo

How Does an Import Letter of Credit Work in International Trade Transactions?

On this page, I will try to answer the question “How Does an Import Letter of Credit Work?” by explaining the import letter of...
letter of credit mistakes

5 Biggest Letter of Credit Mistakes

In international trade, there are couple of payment options available such as cash against documents, open account, advance payment and letter of credit. Letter of...
Partial Acceptance of Amendments

Partial Acceptance of Amendments

According to the letter of credit rules, the beneficiary should communicate its acceptance of the amendment to the bank that advised such amendment. The beneficiary...
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