Advantages
- the importer’s bank irrevocably undertakes to effect payment against presentation of documents complying with the terms and conditions of the documentary credit issued
- the importer’s bank pledged an irrevocable undertaking to effect payment, in case you, the exporter, present complying documents under the documentary credit, regardless of the buyer’s willingness to effect payment or not
- the export documentary credit offers leverage to the exporter for the reason that payment is effected by the importer’s bank only against presentation of complying documents, the importer not being able to prevail himself on potential quantitative or quality merchandise defects that may occur upon delivery of goods
- under a documentary credit, funds can be credited to the exporter’s account, depending on the documentary credit terms and conditions, in connection to discounting of proceeds
Key points for the exporter
- you have the advantage of ensuring that the terms and conditions of the underlying commercial contract have been correctly encompassed within the text of the documentary credit received and advised by the bank, before the goods are shipped
- if drawn properly (you are strongly advised to contact our specialists prior to concluding the transaction), it can offer you a source of financing
Important information
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Talk to a specialist
Bogdan Ilie
Documentary Business Expert
Tel: 0373.516.271