Letter of Credit
A Letter of Credit is an official document that is typically issued by the importer’s bank, but is only secure if you, as the exporter, meet all of its strict conditions and deadlines.
Worryingly, over 75% of UK exporters who process their Letter of Credit paperwork solo experience problems getting paid due to incorrect paperwork. This where we step in and hold your hand all the way.
A letter of credit, or a credit letter, is a letter from a bank guaranteeing that a buyer’s payment to a seller will be received on time and for the correct amount. If the buyer is unable to make a payment on the purchase, the bank will be required to cover the full or remaining amount of the purchase. It may be offered as a facility (financial assistance that is essentially a loan).
Due to the nature of international dealings, including factors such as distance, differing laws in each country, and difficulty in knowing each party personally, the use of letters of credit has become a very important aspect of international trade to protect buyers and sellers.
Buyers of major purchases may need a letter of credit to assure the seller that the payment will be made. A bank issues a letter of credit to guarantee the payment to the seller, essentially assuming the responsibility of ensuring the seller is paid. A buyer must prove to the bank that they have enough assets or a sufficient line of credit to pay before the bank will guarantee the payment to the seller.
We are leaders in export documentation preparation and can take the hassle out of Letters of Credit for your business. Our team of experienced staff will use their strong relationships with all the major global banks to ensure that you receive payment on time for your exports. We deliver a fully managed, comprehensive service that conforms to Letter of Credit requirements with a view to securing payment for your goods.