Managing the Letters of Credit Process

Who do you currently present your letter of credit documents to? Your own bank? Another preferred bank in your own country? Or…… are you being forced to deal with a local office of the issuing bank or their preferred correspondent?  Consider completing and sending to your customer a Letter of Credit Request Template prior to the issuance [...]

2018-05-24T15:05:51+00:00October 10th, 2016|

Using Letters of Credit to Finance Transactions

Whilst a letter of credit is an excellent tool in terms of providing payment security to the seller and more certainty of shipment of the goods / provision of services to the buyer, it can also be very useful for improving cash flow for both parties. This factor is rarely considered by sales or purchasing [...]

2018-05-24T15:08:24+00:00September 26th, 2016|

A Guide to Letter of Credit Charges

In the current global financial climate, many internationally trading companies are turning to letters of credit as a means of securing payment from buyers in new or difficult markets. We regularly hear from internationally trading companies who are shocked by the level of letter of credit charges being deducted by UK based advising or confirming banks. Our popular Letter [...]

2018-05-24T16:36:17+00:00September 6th, 2016|

Getting Paid for Exports

Non payment is a concern for any business. The problem is far greater in International Trade due to the fact that the supplier and buyer are located in different countries.  The following are key considerations for companies who sell overseas: Will I get paid?  Is the buyer creditworthy? Consider credit checks and trade references Do [...]

2018-05-24T15:12:54+00:00August 31st, 2016|

A Guide to Avalised Bills of Exchange

What is an Avalised Bill of Exchange? Bills of Exchange are widely used throughout the world for settlement of debts, however in their normal form they do not guarantee payment by the drawee (debtor). To obtain such a guarantee of payment it is necessary to have the bill guaranteed by a bank, normally the drawees [...]

2018-05-24T15:14:45+00:00August 15th, 2016|

The Top 5 Letter of Credit Tips for Exporters

Check that you have incorporated all costs, including bank transaction charges and confirmation fees (where applicable), into the final sales price. Ask your own bank for a copy of their trade services tariff. We have produced a guide to bank charges which you may find helpful. Please note that this is a general guide based on [...]

2017-03-19T09:07:57+00:00August 4th, 2016|

Is Your Bank Asking You Lots of Questions?

Interesting to hear from a number of our UK based clients recently that their Relationship Manager at the Bank seems a lot more interested and inquisitive about the profile of their international trading business. Who do I buy from/sell to ?, which country are they based in ?, how long have I been trading with [...]

2018-05-24T15:18:55+00:00June 18th, 2016|

Letter of Credit Considerations for Importers

Before deciding to effect payment by letter of credit, an importer should consider the following: Will my bank be prepared to issue a letter of credit and what will be the impact on my banking facilities? Will I have to pay upon presentation of documents (ie: at sight) or can I negotiate an extended credit [...]

2018-05-24T15:20:45+00:00May 21st, 2016|

Bonds and Guarantees, The Challenges for Exporters

As many exporting businesses will be only too aware, it is very common for overseas buyers to insist that a bond or guarantee is provided usually by a bank, as a standard means of securing the terms of the contract and  then usually covering  the exporter's performance of their obligations during the period of the contract. In some instances [...]

2018-03-12T17:22:19+00:00May 12th, 2016|

Are FOB, CFR and CIF Right for Financing?

The Incoterms ® 2010 rules published by the International Chamber of Commerce makes a clear distinction between rules appropriate for any modes of transport and those deemed more suitable for sea and inland waterway transport only. These are classified as follows: Rules for Any Mode or Modes of Transport: EXW, FCA, CPT, CIP, DAT, DAP, [...]

2018-05-24T15:24:44+00:00April 8th, 2016|