Trade Solutions

Letters of Credit
(Import & Export)

A Documentary Credit  constitutes an irrevocable undertaking of the Issuing Bank to honour a complying presentation of documents

International Rule guiding documentary Letter of Credit is ICC UCP600

Benefits

  • Safely Expand your business scope internationally
  • Effective payment Solution
  • Time management that bring efficiency
  • Assurance of payment to Seller
  • Cash Flow Management for both buyer and seller
  • FX management guide for better planning 
  • FCY proceeds generation for Local Exporter
  • Export Proceeds management for Local Exporter
  • Means of Expanding income generation

FOR IMPORT LC

  • Approved form M (supported by required documents)
  • LC Application Form
  • Applicant Credit Worthiness Would be considered.
  • All regulatory conditions must be fully complied with.

FOR EXPORT LC

  • Approved NXP (supported by required document
  • Export Proceeds Account
  • Inward LC
  • All regulatory conditions must be fully complied with

Documentary Collection Or Bills For Collection (Bc)
(Inward – For Local Importer; Outward-for Local Exporter)

FOR IMPORT BC

  • Approved form M (supported by required documents)
  • All regulatory conditions must be fully complied with.

FOR EXPORT BC

  • Approved NXP (supported by required document
  • Export Proceeds Account
  • All regulatory conditions must be fully complied with

“Collection” means the handling by banks of documents in accordance with instructions received from Remitting/Beneficiary’s  bank, in order to:

Obtain payment and/or acceptance, or
Deliver documents against payment and/or against acceptance, or
Deliver documents on other terms and conditions

International Rule guiding documentary Collection is URC522

Benefits

  • Serves as supplier credit to Local importer
  • Less Complicated when compared to LC
  • Process is faster when compared to LC
  • Constructive Control by the exporter over the goods shipped
  • Opportunity to review documents sent before making payment
  • Secured communication between seller and buyer
  • FCY proceeds generation for Local Exporter
  • Export Proceeds management for Local Exporter
  • Means of Expanding income generation

Foreign Guarantees / Sblc
(Inward- For Local Beneficiary; Outward- For Local Applicant)

Description

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

Benefits / Outward Guarantee/Sblc

  • Flexibility – Guarantee or SBLC nature is very flexible and can be issued in line with the transaction dynamics.
  • It is relatively less expensive when compared to LC and BC

Outward Guarantee/Sblc

  • Instruction to Issue guarantee
  • All regulatory conditions must be fully complied with
  • Applicant Credit Worthiness Would be considered

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