Letter of credit (L/C),
Definition of Letter of credit (L/C):
Letters to other banks (especially in other countries) that carry out suicide attempts to pay certain people under certain conditions.
Buyer or Importer Bank (also known as the issuing bank) Written liability to the seller or exporter (called the recipient bank, negotiating bank or payment bank).
A letter of credit guarantees the payment of a certain amount in a specific currency, as long as the seller has complied with the well-defined terms and submitted the required documents within a certain period. These documents almost always contain clear or airway bills, trade receipts and original certificates. To create a credit letter that benefits the seller or exporter (known as the recipient), the buyer (known as the author or shareholder by the bank issued) has a default amount. (Plus service charge). Or credit negotiations. A letter of credit is a regular business instrument and is usually used when the seller refuses to lend to a buyer. In fact, a letter of credit carries with it a bank's credit quality buyer. The international banking system thus acts as a middle ground between exporters and importers. However, the banking system is not responsible for the quality of goods, the authenticity of documents or other terms of sales contracts. Because the definition of terms is so important for the formation of the Letter of Credit, the International Chamber of Commerce (ICC) has proposed special terms (called encotrasms) that are now universally accepted and used almost universally. Are Unlike exchange bills, a letter of credit is a non-negotiable thing, although there are many types of credit, but the two basic ones are (1) the credit of a letter which can be revoked and (2) such a letter. Which cannot be canceled, which is available in two versions: (a) a non-refundable letter and credit (b) a non-refundable and uncertified letter of credit
How to use Letter of credit (L/C) in a sentence?
- Whenever he buys new equipment for the company, he gets a letter of credit, not cash.
- A letter of credit is required to complete a transaction so that the project can begin after approval.
- For example, consider a case where a consumer asks a bank or other institution to issue a letter of credit or guarantee assistance in purchasing goods.
- I received credit for the letter and was glad to know that it meant they would pay.
Meaning of Letter of credit (L/C) & Letter of credit (L/C) Definition