What is a Transferable Letter of Credit?
Transferable letters of credit are a tool used by trading companies, or other third parties, to facilitate a trade transaction. (1)
Transferable letters of credit...
Incoterms
What Does Incoterms Mean?
INCOTERMS (International Commercial Terms) have been created by the International Chamber of Commerce in order to reach an uniform set of...
UCP 600
What is UCP 600?
UCP 600 is the latest version of the rules that govern letters of credit transactions worldwide.
UCP 600 is prepared by International...
What is Letter of Credit
Letter of credit, in a broad perspective, is one of the payment methods in international trade.
The letter of credit is distinguished itself from other...
Letter of Credit Transaction
On my previous posts, I have not only made a definition of a letter of credit, but also clarified its types and parties that involved...
Payment Methods in International Trade
There are 5 types of payment methods available in international trade.
These payment types are cash-in-advance, open account, documentary collections, documentary credits (letters of credit)...
Swift Messages in Letters of Credit
SWIFT is the short form of "Society for Worldwide Interbank Financial Telecommunication".
Swift defines its role in international financial transactions on its website as follows.
“Our...
Bank Guarantees
What is a Bank Guarantee?
Guarantees are usually issued by banks, which is why they are also called 'bank guarantees'; however, they can also be...
Nominated Bank
Nominated bank is another important yet not well understood term in international letter of credit transactions.
May be the biggest contribution of this lack of...
Certificate of Origin
A Certificate of Origin (often abbreviated to CO, C/O, COO) is a trade document, which identifies the origin of goods that is being exported...
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