 |
|
|
Home :
Products and Services :
Treasury Services :
Trade Finance :
Letters of Credit Checklist
Letters of Credit Checklist
It's important to ensure that all letter-of-credit terms and conditions agree with those in the sales contract. Examine the letter of credit line by line. If any details are unsatisfactory, contact the importer and ask the issuing bank to amend the letter of credit and forward to the advising bank. Only the issuing bank can amend the letter of credit, and this requires the consent of all parties.
|
- Is it a genuine letter of credit issued by a bank and validated by the advising bank? (Beware of merchant credits with no bank involvement)
- Is the letter of credit revocable? (Letters of credit are irrevocable unless otherwise stated)
- Is your legal name and address correctly stated?
- Is there enough credit to cover the cost of goods and other exporter costs (eg. freight and insurance) as agreed in the contract?
- Are partial shipments allowed?
- Is transhipment allowed?
- Is the port of destination correctly stated?
- Can the shipping company or freight forwarder provide the type of transport document specified in the credit?
- Do latest dates for shipment and presentation of documents allow enough time for manufacturing and shipment of goods, and delivery of documents to your bank?
- What are the terms of payment - sight draft or term draft?
- Will you be able to obtain and present the documents required?
- Who is responsible for insurance?
- Are the goods correctly described?
- What are the terms of delivery?
- Are there any special conditions?
- Who is responsible for banking charges?
- After issuance of shipping documents, how many days do you have to present the required documents?
|
|
|
|
