STANDBY LETTER OF CREDIT

• Standby Letter of Credit
• Parties involved in SBLC
• SBLC Provider
• What is a Standby Letter of Credit
• Can SBLC be Transferable?
• SBLC MT760 Benefits
• Standby Letter of Credit Cost

 

Standby Letter of Credit

Being a direct SBLC Provider, we support importers and exporters by providing a Standby Letter of Credit – SBLC MT760 on behalf of the importer and in favor of the exporter to conclude their trade deals. 

To avail SBLC, follow the process given below: 

Submit your SBLC request by sending your Sale and Buy Agreement or Proforma offer of your trade deal.
We will review the trade deal between the buyer/seller. After a careful study, we will inform you about our approval of the MT760 request. 
If your request is approved, we will sign a service agreement with you. Also, we will inform you to pay the service charges to commence work on their Standby LC transaction. 
After receiving the service charges, we will structure your SBLC as per your deal and send the SBLC draft for your review & approval. We will then request you to supply the specified documents and pay the issuance fee. 
Upon receiving the issuance fees, documents, and therefore the approved draft, we will act instantly. We offer Standby LC from our checking account with the party’s bank. This MT760 is going to be on behalf of the customer and in favor of their seller to conclude their trade deal. 

What is a Standby Letter of Credit?

It is a written undertaking issued by a bank on behalf of its client. SBLC guarantees the bank’s commitment of payment to the vendor, in the event that the customer defaults. Standby LC may be a “last resort”, meaning the bank fulfills the payment obligations, in case the client fails to oblige with the contract terms. 

Standby letters of credit certify the credit worth and payment strength of the customer. Also, it helps to facilitate global trade between companies that don’t know one another and have different rules & regulations. Therefore, it’s a preferable financial instrument employed by traders and is most reliable in business trade dealings. 

Moreover, SBLC also can be used as collateral for credit enhancement. Thus, it’s ideal for traders who decide to expand their business, without abandoning their cash funds. Having SBLC improves the company’s income and is seen as a symbol of excellent faith. Further, SBLC allows traders to use their cash capital for other dealings before payments become due. 

SBLC MT760 Benefits

SBLC MT760 provides tons of advantages for both importers and exporters as below: 

As an importer, you will cover the risk of the exporter for just one occasion with one SBLC, for a tenure of 1 year. Also, the SBLC can be renewed 15 days before the expiration date. So, it saves you extra money and time in doing repeat business. 

Availing SBLC ensures the delivery of goods/services as per the terms of the trade contract. 

The seller gets a guarantee of their payment once they accept it as true with the T&Cs of SBLC. If for any reason, the payment isn’t made or denied, SBLC acts as an alternate source to say their payment. 

The seller can draw down loans by claiming SBLCs from their bank. 

Parties involved in SBLC

Applicant:
The applicant (buyer) – the one who requests his bank to issue SBLC on behalf of the supplier.
Issuing Bank:
The bank that issues the SBLC MT760 on behalf of their client.
Beneficiary:
SBLC recipient or the supplier who receives the SBLC in their favor.
Advising Bank:
The advising bank features a relationship with the issuing bank and will receive the SBLC to advise an equivalent towards the seller’s bank.
Seller’s Bank:
The seller’s bank, from where the supplier receives the ultimate SBLC. 

Can SBLC be Transferable?

Standby LCs are often transferable if it’s subjected to the terms. Like other bank instruments, it is easily transferrable. Likewise, MT760 is often transferred in favor of a second SBLC recipient. However, it requires a written request by the primary SBLC recipient. 

Standby Letter of Credit Cost

Generally, the applicant (buyer) bears the cost for the issuance of SBLC. Mainly, the value includes bank commission, processing fee, and transmission fee. For more details on our tariff, contact us. 

SBLC Provider

We have been offering SBLC MT760 from various international banks on behalf of buyers. 

Our experts will frame the SBLC MT760 as per your requirement and will assist you to conclude the deal within 48 working hours. 

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