(Inward- For Local Beneficiary; Outward- For Local Applicant)
A bank undertaking to answer for the payment on another person’s debt or obligation in the event of a default by the person primarily responsible for it. Standby Letters of Credit (SBLC) is an LC standing by for the day of default. It share similar features with Documentary LC but unlike LC, the bank obligation would crystalize only after default by the Applicant.
There are many types of guarantees and SBLC depending on the transaction dynamics. Types include Advance Payment Guarantee/SBLC; Performance Guarantee/SBLC; Counter Guarantee/SBLC.
RULES: International Rules guiding Demand Guarantee and SBLC are URDG758 and ISP98 respectively.
Kindly note that terms and conditions apply.
Suitable to meet the dynamics of any business you wish to transact.
Very cost effective when compared with LC and BC