What Is an Import Letter of Credit?

Import letter of credit refers to the issuing bank issuing a beneficiary (foreign exporter) based on the application of the importer to ensure that within a certain period of time, a full set of documents from the negotiating bank / sending bank that meets the requirements of the letter of credit are issued in accordance with the A written commitment to external payments. Letter of credit is a relatively complete international trade settlement method. Thanks to the intervention of bank credit, it has provided guarantees for exporters to securely receive payments and importers to pick up goods with qualified documents.

Import letter of credit

Import Letter of Credit refers to

Import letter of credit business scope: 1. Open various letters of credit, such as:

should

The conditions for issuing an import credit are:

1. The applicant must be an enterprise and unit with legal personality and import management rights.

After the import and export parties have established the settlement by letter of credit in the trade contract, the importer can apply to the local bank for the issuance of a letter of credit in accordance with the trade contract and complete the Application For Irrevocable Documentary Credit. such,

1.

1.Improve the status of negotiations-opening a letter of credit is equivalent to providing exporters with

An import and export company of C, a key customer of trade finance, applied to our bank for an opening amount of USD 8 million and a term of

1. Q: What criteria are met to be exempt

1. The import and export sides hope to make a certain agreement on each other's actions to enhance the credibility of trade;

2,

The basic method for the settlement of import letters of credit:

All companies that apply to the Bank of China for import credit settlement must have the right to operate import and export. If it is the first time to handle this business, you need to provide the Bank of China with a copy of each of the following documents: business license, certificate of approval from the Ministry of Economy and Trade (Commission). If the applicant is a joint venture, the contract and articles of association of the joint venture must also be provided. A company that meets the above requirements can apply to the Bank of China to issue a certificate according to the following procedures.

1. Fill out the application for issuance and issuance checklist first, and affix the official seal.

2. Pay equivalent security deposit or equivalent securities according to the amount of the opened L / C, including bank deposit slips, money orders, etc. If a third-party financial institution guarantee method is adopted, the guarantee letter must be confirmed by Bank of China before it can take effect. If you use the foreign exchange quota plus the supporting RMB to issue a certificate, you must also provide a quota payment certificate with the seal of the foreign exchange administration at the same time as paying the RMB. At the same time, the quota verification seal of the State Administration of Foreign Exchange was affixed to the back of the application for issuance of the bank.

3. If the applicant needs to modify the content of the opened L / C, he can submit a modification application with the applicant's seal to the bank.

4. After the L / C issuance, the bank will send a copy of the L / C to the applicant, and at the same time charge the issuing fee of 1.5 .

5. When the bank receives the relevant documents under the letter of credit, the bank will notify the issuing applicant to obtain the documents. After receiving the notice, the applicant must take the order in time and notify the Bank of China whether it is necessary to refuse the payment within five days. If a chargeback is to be processed, the applicant must return the full set of documents to the bank and submit the reasons for the chargeback in writing.

6. After the L / C is invalid, the applicant must complete a written application to claim the remaining margin balance under the L / C. The application must indicate the name of the payee bank and account number.

The above is the current basic method for the settlement of import letters of credit. In case of special problems in the actual handling of business, you can also negotiate with the Bank of China.