Standby Letter of Credit

For the Importer

Standby Letter of Credit allows you to cover financial obligations to your beneficiary in the event of payment default after the beneficiary has secured due performance. Standby Letter of Credit represents a simple form of security to your beneficiary and does not require proof of non-performance other than a simple claim. Standby Letter of Credit is similar to a bank guarantee where the bank will guarantee payment in the event default, eliminating buyer's risk of non-payment.

Benefits

• Proof of non-performance is not required other than a simple claim
• Can be used to secure the issuance of guarantees and financial facilities in addition to trade
• Can be used as a simple form of security to support open account trading where your supplier can claim on the Standby Letter of Credit in case of non payment
• Governed by International Chamber of Commerce rules
• Can be issued to beneficiaries worldwide in major currencies in the form of SWIFT, telex, courier and registered mail

For the Exporter

Standby Letter of Credit provides the beneficiary with assurance that payment will be received in the event of applicant default. Standby Letter of Credit represents a simple form of security to you and does not require proof of default other than a simple claim. Standby Letter of Credit is similar to a bank guarantee where the bank will guarantee payment in the event of default, eliminating buyer's risk of non-payment.

Benefits

• Proof of non-performance is not required other than a simple claim
• Can be used to secure the issuance of guarantees and financial facilities in addition to trade
• Can be used as a simple form of security to support open account trading where you can claim on the Standby Letter of Credit in case of non payment by the buyer
• Can be used in countries where guarantees are not acceptable such as in the US
• Governed by International Chamber of Commerce rules
• Can be received from applicants worldwide in major currencies in the form of SWIFT, telex, courier and registered mail