Letter of Credit

Introduction The financial relationship between buyer and seller is developed on the foundation of trust. To build a long term business interconnection payment guarantee is essential.  To make sure the payment transaction smoothly works between parties’ letter of financial credit plays an integral role. Definition In international trading, the banks provide a guaranteeing letter that […]

By definition, it’s a third-party guarantee on behalf of its client to another party for payment of a contract. Banks and large financial institutes issue letters of guarantee on behalf of their business clients to their suppliers to ensure the contract payment will be made if their customer fails to make the obligation. In other

Financial institutions provide many types of facilities to businesses. Among these facilities are the letter of credit and line of credit. While the names may sound similar, they are different facilities. Both of them have different structures. Similarly, businesses use them for different purposes. They also span over different lengths of time. Businesses must know

Introduction Modern-day trade involves global integration as a result of digitalization, and globalization. With global trade reaching new heights with every passing day, associated transactions are also likely to increase. With considerable transactions, there is also an added responsibility to ensure that organizations can take care of their payment cycles to maintain a seamless relationship