LC / SBLC
(STANDBY LETTER OF CREDIT /BANK GUARANTEE)
An SBLC is frequently used as a safety mechanism for the beneficiary, in an attempt to hedge out risks associated with the trade. Simplistically, it is a guarantee of payment which will be issued by a bank on behalf of a client. It is also perceived as a “payment of last resort” due to the circumstances under which it is called upon.
Capitalbanc offers SBLC / BG for period of 1 year.
Partners & Associates
LC (Letter of Credit)
A letter of credit represents an unconditional undertaking by the Issuing Bank to pay/accept to pay to the beneficiary on fulfilment of stipulated documentary conditions.
LC's are used in international transactions to ensure the payment to the seller by the buyer.
Capitalbanc offers 2 types of LCs for your Trade Transactions:
LC at Sight
An LC at sight is a letter of credit (LC) that is payable immediately (within 7 to 10 days) after the seller meets the requirements of the letter of credit. This type of LC is the quickest form of payment for sellers, who are often exporting to overseas buyers.
Usance (or deferred) Letter of Credit is a specific type of LC payable at a predetermined time period.
A Usance or a Deferred Letter of Credit, also known as a time or term LC. It is a letter of credit that is payable at a predetermined or future point following the conditions in the LC being fulfilled and the confirming documents being presented.
A usance LC is used for the same reason that credit terms are provided. It allows the purchaser flexibility, increased working capital and the availability to sell through stock prior to payment. Paying for the goods is easier at a later date when compared to payment upon receipt; as there will usually have already been an element of payment collection at this point, from the ultimate purchaser.
Capitalbanc offers Usance LCs for a period of 90 days, 120 days, 180 days.