What is the postponed accreditation?

A postponed accreditation (LC) is a document that issues financial institutions and is often used in business financing. Like all types of letter of credit, the deferred LC is used to ensure that the payment will be made for the goods ordered by the buyer, allowing the seller to use the document to obtain financing for the production and sending of this order. What is different in this document is exactly when and how this payment will be moved to the Seller's bank.

with a deferred letter of credit, issuing the Bank advises the Seller's consulting bank that the sources to cover the payment for the order are available and have been canceled for this purpose. This is often very useful in terms of international trade arrangements, because the exporter or seller has a lot to prove the buyer's obligation. The letter of the letter will be details on when the funds will be handed over to the receiving bank. This is usually some time after the order is filled and accepted and may even include the provisions for issuing the Pay seriesEB rather than one payment to cover the cost of order and transport.

For example, one used for purchase may include a wording that provides specific data and amounts offered in this data in order to fulfill the obligation for the seller. There are usually certain provisions in the document that also protects the buyer, that if the goods are not delivered by the agreed date of receipt, or if the goods are lost or damaged during transport, the payment plan may be subject to the subject until these problems are resolved. From this point of view, the method of postponing helps to protect the interests of the buyer and at the same time gives the seller a certain level of warranty when receiving payment.

Since a postponed letter of credit is issued by a financial institution, it means a tkat that the buyer must deliver documentation to prove that any exceptions listed in the document actually occurred in fact beforePayment delay. If the items in the order arrive in time and in fact the items are described by the seller, in other words, the buyer cannot delay the payment on the basis of the decision that the goods are not required after all. Only if the Seller fails to fulfill its obligations, can the buyer take measures to delay payments, and then only if this failure can be proven by satisfying the issuing bank.