Letters of Credit

Documentary letter of credit is an instrument of security and payment mostly used in the international payment operations. In case of issuing of the letter of credit, the Issue Bank, according to the client’s order, assumes the irrevocable commitment to execute payment on the date stipulated in the agreement – negotiating of the submitted documents in favour of the letter of credit beneficiary, if all the documentation on export performed prove to be in order and in compliance with the terms and conditions previously anticipated in the letter of credit. As an instrument of payment, the letter of credit provides security both to the purchaser and to the seller of respective merchandise.