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CHANAKYA

NATIONAL
LAW
UNIVERSITY
LETTER OF CREDIT: AN EFFECTIVE MODE OF
TRANSACTION

Submitted to: Dr. P.P. Rao


Faculty of ITL
Submitted by: Ankit Anand
Roll: 917
6th semester
LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

Table of Contents

ACKNOWLEDGEMENT .............................................................................................. 3

AIMS AND OBJECTIVE .............................................................................................. 4

RESEARCH METHODOLOGY ................................................................................... 4

SOURCE OF DATA ...................................................................................................... 4

HYPOTHESIS ................................................................................................................ 4

1.INTRODUCTION ....................................................................................................... 5

2.WHAT IS LETTER OF CREDIT AND ITS TYPES ................................................. 7

3.PARTIES TO ANDASSOCIATION OF LETTER OF CREDIT............................. 11

4. ADVANTAGE AND DISADVANTAGE OF USING A LETTER OF CREDIT .. 13

5. CONCLUSION ........................................................................................................ 17

BIBLIOGRAPHY ........................................................................................................ 18

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

ACKNOWLEDGEMENT

Making a project is one of the most significant academic


challenges I have ever faced. Any attempt at any level can't be
satisfactorily completed without the support and guidance of
learned people. I am overwhelmed with my gratitude to
acknowledge all those who have helped me put these ideas, well
above the level of simplicity and into something concrete
effectively and moreover on time.

I am very thankful to my subject teacher Dr. P. P. RAO for his


valuable help. He was always there to show me the right track
whenever I needed his help. He lent his valuable suggestions,
guidance and encouragement, on different matters pertaining to
the topic. He has been very kind and patient while suggesting me
the outlines of this project and clearing my doubts. I thank him
for his overall support without which I would not have been able
to complete this project. I would also like to thank my
colleagues, who often helped and gave me support at critical
junctures, during the making of this project. Last but not the
least, I would like to thank my family members for their
emotional support.

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

AIMS AND OBJECTIVE


The main aim objective of the researcher is to know what is letter of credit. How much it is
important in International trade. And also its advantage and disadvantage to exporter and
importer.

RESEARCH METHODOLOGY
The researcher has adopted the doctrinal method of research for the project.

SOURCE OF DATA
The following sources of data have been used in the project are:
1 .Books
2. Websites
3. Articles

HYPOTHESIS
Researcher hypotheses that the letter of credit is always advantageous to both importer and
exporter.

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

1.INTRODUCTION

Every business transaction consist of at least two parties that are the importer and exporter. In
addition, some of the transactions involve not only the buyer and seller, but also the banks of
the parties, government customs agencies and freight forwarders as well. Profiting from the
transaction and being exposed to the smallest risk are the common concern of both parties.
However, in all transactions buyers and sellers exposed to the risk somehow. Domestic
transactions are stable, transparent, secure or reliable as compared to international
transactions that are risky because of changing dynamics at the time of sale and expected
time of payment. Therefore, the seller always prefer to be paid at delivery or prior to it. The
seller has made investment in the time of manufacturing the product and does not prefer
bearing the cost of transportation as well. On the other hand, the buyer aware of the fact that
it can take one or two months before goods had arrived. Goods will be ready for export,
trucked or sent by rail to the port, export cleared, shipped to the final port, warehoused
awaiting customs clearance, inspected, customs cleared, sent overland to the final destination,
and finally became inventory at warehouse of buyer Therefore, both buyer and seller prefer
that other party finance the transaction and pay for the cost. Domestic payments primarily use
credit cards and checks. International payments primarily use Commercial Letters of Credit
and Documentary Collections or open account.1

The English name “letter of credit” derives from the French word “accreditif”, a power to do
something, which in turn is derivative of the Latin word “accreditivus”, meaning trust.
A letter of credit is basically a document issued by a bank guaranteeing a client's ability to
pay for goods or services. A bank or finance company issues a letter of credit on behalf of a
buyer, authorizing the seller to obtain payment within a specified timeframe once the terms
and conditions outlined in the letter of credit are met. The letter of credit acts like an
insurance contract for both the buyer and seller and practically eliminates the credit risk for
both parties, while at the same time reducing payment delays. A letter of credit provides the
seller with the greatest degree of safety when extending credit. It is useful when the buyer is
not well known and when exchange restrictions exist or are possible.

1
http://www.lawteacher.net/free-law-essays/commercial-law/documentary-letter-of-credit-commercial-law-
essay.php

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

The LC can also be the source of payment for a transaction, meaning that a will get paid by
redeeming the letter of credit. Letters of credit are used primarily in international trade
transactions of significant value, for deals between a supplier in one country and a customer
in another. The parties to a letter of credit are usually a beneficiary who is to receive the
money, the issuing bank of whom the applicant is a client, and the advising bank of whom the
beneficiary is a client. Almost all letters of credit are irrevocable, i.e., cannot be amended or
cancelled without prior agreement of the beneficiary, the issuing bank and the confirming
bank, if any. In executing a transaction, letters of credit incorporate functions common
Traveler's cheques.

The letter of credit is a specified documentation particularly required to enjoy the facility of
credit for an international business transaction. These documents are tendered by the seller to
the advising bank. These documents must agree strictly in accordance with the fundamental
principle of strict compliance of the terms of the transaction. If the doctrine of strict
compliance is fully observed then no issue arises. According the provisions of the UCP 600,
the banks are only obliged to make payments on LCs if the documents presented completely
comply with the terms and conditions of the credit.

If the strict compliance standard is not observed in the credit documents strictly, the banks
need not to pay to the beneficiary on these ‘afflicted’ documents (UCP 600).

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

2.WHAT IS LETTER OF CREDIT AND ITS TYPES

A Letter of Credit, simply defined, is a written instrument issued by a bank at the request
of its customer, the Importer (Buyer), whereby the bank promises to pay the Exporter
(Beneficiary) for goods or services, provided that the Exporter presents all documents
called for, exactly as stipulated in the Letter of Credit, and meet all other terms and
conditions set out in the Letter of Credit. A Letter of Credit is also commonly referred to as
a Documentary Credit.2

Letter of Credit is a commercial document issued by a bank in normal course of business


which carries a payment guarantee obligation in case of adverse situation arises. A bank
issue LC on the request of its client in favour of a third party (beneficiary). It is important
instrument to the extent that it smoothens & secures the transactions ensuring to the party in
whose favour the LC is opened that if any adverse situation arises and its client failed to
make the payment than the issuing bank will pay subject to the terms and conditions
mentioned at the time of issue of LC. This document is most important in case both the
parties doing business first time. These parties can do business without any or very low risk,
as bank gives a safety assurance to both the parties, involved with the transaction.3

There are several types of Letters of Credit: revocable and irrevocable. A revocable Letter of
Credit can be revoked without the consent of the Exporter, meaning that it may be cancelled
or changed up to the time the documents are presented. A revocable Letter of Credit affords
the Exporter little protection; therefore, it is rarely used. An irrevocable Letter of Credit
cannot be cancelled or changed without the consent of all parties, including the Exporter.
Unless otherwise stipulated, all Letters of Credit are irrevocable.

2
http://www.abhinavjournal.com/images/Commerce_&_Management/Dec13/10.pdf
3
http://www.abhinavjournal.com/images/Commerce_&_Management/Dec13/10.pdf

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

Another type of Letter of Credit is confirmed and unconfirmed. A confirmed letter of credit is
one where a second bank agrees to pay the letter of credit at the request of the issuing bank.
While not usually required by law, an issuing bank might be required by court order to only
issue confirmed letters of credit if they are in receivership. As you might guess,
an unconfirmed letter of credit is guaranteed only by the issuing bank. This is the most
common form with regard to confirmation.

A letter of credit may also be a transferrable letter of credit. These are commonly used when
the beneficiary is simply an intermediary for the real supplier of the goods and services or is
one of a group of suppliers. It allows the named beneficiary to present its own documentation
but transfer all or part of the payment to the actual suppliers. As you might guess, an un-
transferrable letter of credit does not allow transfer of payments to third parties.4

A further differentiation is made between Letters of Credit, depending on the payment terms.
If payment is to be made at the time documents are presented, this is referred to as a sight
Letter of Credit. Alternatively, if payment is to be made at a future fixed time from
presentation of documents (e.g. 60 days after sight), this is referred to as a term, or deferred
payment Letter of Credit.5

The International Chamber of Commerce (ICC) publishes internationally agreed-upon rules,


definitions and practices governing Letters of Credit, called “Uniform Customs and Practice
for Documentary Credits” (UCP). The UCP facilitates standardization of Letters of Credit
among all banks in the world that subscribe to it. These rules are updated from time to time;
the last revision became effective January 1, 1994, and is referred to as UCP 500. Copies of
the UCP 500 are available from your TD branch or Global Trade Finance office. Please refer
to the back cover of this guide for a listing of these offices.6

4
http://study.com/academy/lesson/what-is-a-letter-of-credit-definition-types-example.html
5
https://buyerscreditconsultant.wordpress.com/2014/10/22/letter-of-credit/#more-200212
6
International Chamber of Commerce, Uniform Customs and Practices for Documentary Credits, I.C.C. Pub.
No. 400 (1993) [hereinafter U.C.P. 500]. The names for each party may differ in different jurisdictions .

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

The following is a step-by-step description of a typical Letter of Credit


transaction:

1.An Importer (Buyer) and Exporter (Seller) agree on a purchase and sale of goods
where payment is made by Letter of Credit.

2.The Importer completes an application requesting its bank (Issuing Bank) to issue a
Letter of Credit in favour of the Exporter. Note that the Importer must have a line of
credit with the Issuing Bank in order to request that a Letter of Credit be issued.

3.The Issuing Bank issues the Letter of Credit and sends it to the Advising Bank by
telecommunication or registered mail in accordance with the Importer’s instructions. A
request may be included for the Advising Bank to add its confirmation. The Advising
Bank is typically located in the country where the Exporter carries on business and may
be the Exporter’s bank.

4.The Advising Bank will verify the Letter of Credit for authenticity and send a copy to
the Exporter.

5.The Exporter examines the Letter of Credit to ensure:

(a) it corresponds to the terms and conditions in the purchase and sale agreement;

(B) documents stipulated in the Letter of Credit can be produced; and

(C) the terms and conditions of the Letter of Credit may be fulfilled.

6.If the Exporter is unable to comply with any term or condition of the Letter of Credit or if
the Letter of Credit differs from the purchase and sale agreement, the Exporter should
immediately notify the Importer and request an amendment to the Letter of Credit.

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

7.When all parties agree to the amendments, they are incorporated into the terms of the Letter
of Credit and advised to the Exporter through the Advising Bank. It is recommended that the
Exporter does not make any shipments against the Letter of Credit until the required
amendments have been received.

8.The Exporter arranges for shipment of the goods, prepares and/or obtains the documents
specified in the Letter of Credit and makes demand under the Letter of Credit by presenting
the documents within the stated period and before the expiry date to the “available with”
Bank. This may be the Advising/Confirming Bank. That bank checks the documents against
the Letter of Credit and forwards them to the Issuing Bank. The drawing is negotiated, paid
or accepted as the case may be.

9.The Issuing Bank examines the documents to ensure they comply with the Letter of Credit
terms and conditions. The Issuing Bank obtains payment from the Importer for payment
already made to the “available with” or the Confirming Bank.

10.Documents are delivered to the Importer to allow them to take possession of the goods
from the transport company. The trade cycle is complete as the Importer has received its
goods and the Exporter has obtained payment.

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

3.PARTIES TO ANDASSOCIATION OF LETTER OF CREDIT

1. Applicant
The applicant is the party who requests and instructs the issuing bank to open a letter of
credit in favour of the beneficiary. The applicant usually is the importer or the buyer of goods
and/or services. The applicant can also be another party acting on behalf of the importer, such
as a confirming house. The confirming house is equivalent to a buying office, it acts as an
intermediary between buyer and seller, and it can be located in a third country or in the
seller’s country.7

2.Beneficiary

The beneficiary is entitled to payment as long as he can provide the documentary evidence
required by the letter of credit. The letter of credit is a distinct and separate transaction from
the contract on which it is based. All parties deal in documents and not in goods. The issuing
bank is not liable for performance of the underlying contract between the customer and
beneficiary. The issuing bank's obligation to the buyer, is to examine all documents to insure
that they meet all the terms and conditions of the credit. Upon requesting demand for
payment the beneficiary warrants that all conditions of the agreement have been complied
with. If the beneficiary (seller) conforms to the letter of credit, the seller must be paid by the
bank.8

3.Issuing Bank

The issuing bank's liability to pay and to be reimbursed from its customer becomes absolute
upon the completion of the terms and conditions of the letter of credit. Under the provisions
of the Uniform Customs and Practice for Documentary Credits, the bank is given a
reasonable amount of time after receipt of the documents to honour the draft. The issuing
banks' role is to provide a guarantee to the seller that if compliant documents are presented,
the bank will pay the seller the amount due and to examine the documents, and only pay if
these documents comply with the terms and conditions set out in the letter of credit.

7
http://howtoexportimport.com/8-parties-involved-in-an-LC-Letter-of-Credit-LC-423.aspx
8
http://www.letterofcredit.biz/Parties_to_Letters_of_Credit.html

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

Typically the documents requested will include a commercial invoice, a transport document
such as a bill of lading or airway bill and an insurance document; but there are many others.
Letters of credit deal in documents, not goods.9

4.Advising Bank
An advising bank, usually a foreign correspondent bank of the issuing bank will
advise the beneficiary. Generally, the beneficiary would want to use a local bank to
insure that the letter of credit is valid. In addition, the advising bank would be
responsible for sending the documents to the issuing bank. The advising bank has
no other obligation under the letter of credit. If the issuing bank does not pay the
beneficiary, the advising bank is not obligated to pay.

5.Confirming Bank
The correspondent bank may confirm the letter of credit for the beneficiary. At the
request of the issuing bank, the correspondent obligates itself to insure payment
under the letter of credit. The confirming bank would not confirm the credit until it
evaluated the country and bank where the letter of credit originates. The confirming
bank is usually the advising bank.10

9
http://www.effective-business-letters.com/Parties-Involved-in-A-Letter-of-Credit-Transaction.html
10
http://howtoexportimport.com/8-parties-involved-in-an-LC-Letter-of-Credit-LC-423.aspx

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

4. ADVANTAGE AND DISADVANTAGE OF USING A LETTER OF


CREDIT

Advantages to the Importer

While accepting a LC, the supplier guarantees to meet the terms and conditions of letter of
credit with documentary proof. This is one of the major advantages of LC to an
importer/buyer. This assurance provides security to buyer for future business plan.

Since buyer is the holder of Letter of credit, Bank acts on behalf of buyer. Opening bank
remits amount only after satisfaction of all terms and conditions of letter of credit with
documentary proof. This arrangement protects importer and minimize time, as bank acts on
behalf of him.

A letter of credit transaction reduces the risk of non performance by the supplier, as the
supplier prefers LC than other transactions due to various reasons which protect him than the
buyer. This is an advantage for the buyer on fulfilment of meeting commitments on
shipments.

Another advantage of letter of credit to a buyer/importer is that the exporter/seller receives


payment of exported goods only after shipment and meeting of all necessary requirements
under LC terms and conditions with presentation of documentary proof including evidence of
shipment.

Unlike other shipments, a shipment under Letter of credit is treated with most care to meet
delivery schedule and other required parameters by the exporter. The documents receive by
buyer promptly and quickly with complete sets. Unless meeting delivery schedule and
prompt documentation, the supplier does not get his payment from opening bank. This is one
of the major advantages of LC for an importer is concerned.

An importer/buyer is concerned; he can plan his payment schedule properly by anticipating


the requirements under letter of credit. This arrangement makes importer for easier planning.

Based on timely delivery schedule, buyer receives goods on time thereby he can execute his
business plan smoothly and efficiently, in turn satisfying his clients promptly and
effectively.11

11
http://howtoexportimport.com/Advantages-of-LC-letter-of-credit-%E2%80%93-to-Importers--427.aspx

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

Disadvantages to the Importer

One of the major disadvantages of letter of credit is that LC is operated on the basis of
documentation and not on the basis of physical verification of goods on its quality, quantity
or other parameters. In other words, an LC issuing bank can effect payment to beneficiary of
LC on the basis of documentation produced as per the terms and conditions of letter of credit.
The parties under letter of credit do not have any right to physically verify the contents of
goods. So, if the buyer needs to confirm and satisfy on the quality of goods he buys, he can
appoint an inspection agency of international repute and instruct exporter to enclose
certificate of such inspection by mentioning a condition in letter of credit.

Once opened a confirmed and irrevocable letter of credit, the importer/buyer already tied up
with the said business credit line and can not change in between. Due to various reasons,
especially on selling price variation, if buyer needs to stop his export order he can not do so.

Compared to other payment mode of transactions, cost of operating letter of credit procedures
and formalities are more, which may be an additional expenses to an importer especially on
amendment, negotiation etc.

Currency fluctuation is another disadvantage of Letter of credit. Normally buyer/importer


places purchase orders once in a year and opens letter of credit accordingly. The exchange
rate may differ at the time of effecting payment. So, if any loss due to fluctuations in foreign
currency contracted under letter of credit, need to be beard by him. This is also one of the
major demerits of LC.

Currency fluctuations may also effect on price variation in local market. The demand of
imported goods may reduce due to such fluctuation of foreign currency. So currency
fluctuation also is a threat under letter of credit which is treated as other disadvantages of
letter of credit.12

12
http://howtoexportimport.com/Disadvantages-of-LC-letter-of-Credit-to-Importer--429.aspx

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

Advantages to the Exporter

One of the best methods after advance mode of payment for any business transaction is Letter
of Credit (LC) mode, as buyer’s bank guarantees payment to seller through seller’s bank on
presentation of required documents as per LC.
The major advantage of Letter of credit to a supplier is minimizing of credit risk. In an import
and export trade, the geographical distance between importer and exporter is very far; hence
ascertaining credit worthiness of buyer is a major threat. In a mode of Letter of credit, such
risk can be avoided.

Buyer can not deny payment by raising dispute on quality of goods, as letter of credit terms
and conditions are based on documentation. This is a major advantage of Letter of Credit in
terms of seller point of view. Some of the fraudulent buyers deliberately delays or hold
payments by complaining on quality of goods. In a letter of credit terms of business
transactions, rejection of export payment by raising complaint on quality of goods can not be
effected.

LC provides a security to exporter which is another advantage of a letter of credit. Based on


such security, the exporter can pre-plan his further business activities to strengthen his
business world.

In a letter of credit, any dispute in transaction can be settled easily, as LC terms and
conditions are under the guidelines of uniform customs and practice of documentary credit.
This is another advantage of a LC for an exporter.

In a letter of credit, all required documents have been mentioned well in advance of shipment
and there is no confusion or misunderstanding to the importer (buyer) to inform supplier to
act in between. This is a good advantage for a supplier to pre-plan efficiently which saves
time.

Against a Letter of Credit, an exporter can avail pre shipment finance from banks or other
financial institutions. This is another advantage of Letter of credit for a seller. Many banks
extend financial assistance with minimum bank interest, as letter of credit is a ‘safe export
order’.

Assurance to receive money in full is another advantage of letter of credit. During my career,
I had bitter experience on some of the transactions that I had short received invoice amount
under a non LC transaction by informing us one of the other reasons by buyer. In a letter of
credit, an exporter can ensure that he receives full amount as per LC which helps seller to
plan future business ideas.

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

Another advantage under a Letter of Credit transaction is that the exporter receives money on
time. As you know, ‘finance at right time’ is a prime factor for any business transaction. So if
a business man receives his anticipated amount on time, he can plan his business activities
smoothly without wasting time. This is one of the major advantages of letter of credit.
Assurance to receive money on time is one of the major advantages to supplier/exporter in a
Letter of credit terms.13

Disadvantages to the Exporter

While accepting a letter of credit, the exporter guarantees to meet the requirements of
buyer as mutually agreed as per the terms and conditions mentioned in letter of credit. So the
liability of meeting all required parameters are with supplier failing which bank may not
accept documents under such transaction. Bank may debit certain charges against the
discrepancy of documents also if proper documentary proof has not been submitted along
with other shipping documents. So, if the exporter does not follow strictly with the terms and
conditions of letter of credit with 100% compliance of documentation, the payment will not
be effected by bank.

Under letter of credit opening procedures, there are certain bank charges and other costs. If
buyer insists seller to pay such costs, the said charges will be additional expenses for the
supplier.

If exporter is aware that the credit worthiness of buyer is favourable and sound, he does not
need to open a letter of credit to transact with such buyers. However, he agrees on opening
LC based on the requirements of buyer to enjoy the advantage of opening LC by buyer. In
such cases, meeting of all terms and conditions under letter of credit is the major
responsibility of exporter. Apart from meeting additional documentation procedures, exporter
needs to spend additional expenses also.14

13
http://howtoexportimport.com/Advantages-of-Letter-of-Credit-LC-for-exporters-426.aspx
14
http://howtoexportimport.com/Disadvantages-of-Letter-of-credit-LC-for-Exporter-428.aspx

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

5. CONCLUSION

From the above brief discussion on Letter of credit researcher reached to the conclusion that
the Letters of credit is very important instruments in the field of international trade. They
provide security for both the Importer, which he can ensure to get the goods and for the
Exporter, which he can ensure to get payment when he sends the goods. Letters of credit
also makes the transactions very smoothly. It gives the mechanism stability; especially from
the Importer and the Exporter’s perspective. For instance, there is little or no previous
trading relationship among the parties; the letters of credit provide them to work with
confidence and security. Letter of credit is an effective mode of transaction in International
trade. And the researcher hypothesis that the letter of credit is always advantageous to both
exporter and importer is partially correct because as mentioned above it is sometimes
advantageous to the exporter and sometimes to the importer. Also, sometimes it is
disadvantageous to the exporter and importer. Still Letter of credit is an effective mode of
transaction in International trade because domestic transactions are stable, transparent,
secure or reliable as compared to international transactions that are risky because of
changing dynamics at the time of sale and expected time of payment. And Therefore, the
seller always prefer to be paid at delivery or prior to it. On the other hand, the buyer aware
of the fact that it can take one or two months before goods had arrived. Therefore, both
buyer and seller prefer that other party finance the transaction and pay for the cost. Domestic
payments primarily use credit cards and checks. International payments primarily use
Commercial Letters of Credit and Documentary Collections or open account. The letter of
credit acts like an insurance contract for both the buyer and seller and practically eliminates
the credit risk for both parties, while at the same time reducing payment delays. A letter of
credit provides the seller with the greatest degree of safety when extending credit. It is
useful when the buyer is not well known and when exchange restrictions exist or are
possible. It is important instrument to the extent that it smoothens & secures the transactions
ensuring to the party in whose favour the LC is opened that if any adverse situation arises
and its client failed to make the payment than the issuing bank will pay subject to the terms
and conditions mentioned at the time of issue of LC. This document is most important in
case both the parties doing business first time. These parties can do business without any or
very low risk, as bank gives a safety assurance to both the parties, involved with the
transaction.

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LETTER OF CREDIT: AN EFFECTIVE MODE OF TRANSACTION

BIBLIOGRAPHY

BOOKS REFERED:-
 International Trade law, 2005, Indira carr
 The International Trade system by Alice Landau
 Advanced International trade: Theory and evidence by Robert C Feenstra

WEBSITES:-

 http://howtoexportimport.com/Disadvantages-of-LC-letter-of-Credit-to-Importer--
429.aspx
 https://www.crfonline.org/orc/cro/cro-9-1.html
 http://www.effective-business-letters.com/Parties-Involved-in-A-Letter-of-Credit-
Transaction.html
 http://www.letterofcredit.biz/Parties_to_Letters_of_Credit.html
 http://study.com/academy/lesson/what-is-a-letter-of-credit-definition-types-
example.html
 https://buyerscreditconsultant.wordpress.com/2014/10/22/letter-of-credit/#more-
200212

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