Advantages Of Letter Of Credit-googims

The letter of credit is a statement issued by one party on another undertaking to honour the documents covering the shipment of goods on presentation provided the goods are shipped in time according to the terms and conditions as stipulated in the letter of credit. There are different varieties of letter of credit namely; a)Documentary letter of credit and clean letter of credit; b)Revocable and irrevocable letters of credit; c)Confirmed and unconfirmed letters of credit; d)Fixed and revolving letters of credit; e)With and without recourse letters of credit; f)Transferable and non transferable letters of credit; g)Back to back letters of credit; h)Red clause letter of credit etc. The letter of credit offers several advantages both to the importer and exporter. Advantages to the importer: 1.The importer (buyer) can purchase goods on credit from foreign merchants who do not know him and may not rely upon his standing. This is possible only through the letter of credit issued by the banker; 2.The importer is assured that the exporter cannot obtain any benefit under the letter of credit, without actually shipping the merchandise and handing over the documents to the bank; 3.The issuing banker lends the advantage of his own credit to the importer, who is able to securer better terms of trade from the foreign supplier. This will be impossible without bankers letter of credit. 4.When banks are willing to assume the credit risks of the importer, shipping documents are surrendered to him in return for his trust receipt and thus goods are released. Advantages to the exporter: a)Certainty of payment: When it comes to the parties; namely the importer and exporter as mentioned in the letter of credit, even though the importer and exporter are not known to each other, since the letter of credit provides an absolute assurance on the part of the importer that the bills will be honoured as per the terms of the agreement, the exporter is very certain of his payment at all times. b)Exchange security: Possession of a bankers letter of credit tends to eliminate for the exporter, the risk of trade control or exchange control regulations in the country of the importer, preventing or regulating payment to the former by the time when the payment becomes due. c)Credit facilities: The exporter can secure loans from his bank to buy or manufacture the goods to be supplied on the strength of the letter of credit d)Discounting facilities: The bills of exchange drawn under the letter of credit are readily discounted (negotiated with the advising/confirming banker or any other banker, because of the firm undertaking given by the opening banker. Complete The Project Of Chemical Engineering Assignment With An Ease By: Richard Swayar – This academic help has proven very beneficial to the students. The students are also provided with ready – made assignments as well as free revision papers. Tags: What To Do After Revit Training? By: Prabhat Ranjit Singh – Revit is important software available to learn today. Today, various businesses catering to the AEC industry use this software and as a result several training centres provide online Revit training to their students. This article elaborates on the benefits of Revit training and how it can be useful … Tags: Top 5 Reasons Why One Should Learn Latest Versions Of Autodesk Software By: Prabhat Ranjit Singh – Autodesk has been updating its software on a regular basis and those looking to pursue a career in the AEC industry must keep themselves updated on them. This article states the reasons for which the Autodesk software users should keep themselves updated about on the latest versions by undergoing A … Tags: Coaching For Bba Entrance Tests Is The Stepping Stone For A Career In Business By: Jemma Barsby – Law entrances are one most popular exams attempted by students. There are a huge number of students appearing for the different law entrance exams. Among them DU LLB entrance exams are very popular with thousands of applicants attempting this exam each year. Tags: Get The Best Law Entrance Coaching To Be A Successful Lawyer In The Town By: Jemma Barsby – If you are choosing law as your career then you should have a thorough knowledge of how it may help, before proceeding. Though there are lots of coaching centres which provide with LLB coaching, still doing a bit of homework is not at all a bad idea. Tags: Do You Need Best Nursing Homework Assignment Help From The Medical Experts By: Richard Swayar – The professional writing assistance is provided to the students at a very reasonable price. The primary skill involved in professional writing is the good communication along with good knowledge of grammar and language. Tags: Understanding Profit And Loss By: chris10martin – Traditionally, Profit & Loss has always been an important chapter for CAT. Besides, all other Management entrance exams like SNAP, CMAT, MAT, ATMA as well as Bank P.O. exams extensively use questions from this chapter. From the point of view of CAT, the relevance of this chapter has been gradually … Tags: Professional Year Program: Your Road To Have A Wonderful Career By: Shaun Peter – A professional year program offers lots of benefit to the students, it gives them an opportunity to work in Australian working environment and also very helpful for those who wants to attain Australias permanent residence. Tags: Why Fashion Design Is A Form Of Art Which Tas Are The Secret Ingredient By: Kaira – The designer inspires the creative ideas of the fashion world, managing creativity, technology, information and the understanding of fashion trends. Tags: Complete Your Accounting Assignment Ratio Analysis With An Ease By: Richard Swayar – These days, academic help is available online, so it is available at the time, whenever required by you. This help does not consider the location of the user or the individual looking for the help, as it is online. Tags: 相关的主题文章: