Letter of Credit - 3

17/12/2009 04:50


Tenor: Sight LC, Acceptance LC, Deferred LC, Negotiation LC.


Sight LC – beneficiary get the payment on presentation of documents.

Acceptance LC (Usuance LC) – bill of exchange or drafts are drawn with certain Usuance period.

Deferred LC – it is similar to Usuance LC except no bill of exchange.

Negotiation LC – issuing bank undertakes to make payment to Negotiating Bank.

Back to Back LC – when an exporter arranges to issue an LC in favour of local suppliers to procure goods on strength of export LC received in his favour.