Import Letter of Credit

Overview

It is a written commitment to pay, by a Buyer's/ Importer's Bank (called the Issuing Bank) to the Seller's/ Exporter's Bank (called the Accepting Bank, Negotiating Bank or Paying Bank). A Letter of Credit guarantees payment of a specified sum in a specified currency, provided the seller meets precisely defined conditions and submits the prescribed documents within a fixed timeframe.

Features &
Benefits

Features & Benefits

Benefit from Axis Bank's expertise to examine if the shipping documents are compliant with the terms of LC
Enjoy faster processing and same day delivery of LC
Trade with sellers across the globe on the strength of our wide network of correspondent banking relationships
Quick and convenient online LC issuance process
Can be availed against sanctioned credit limits or Fixed Deposit

How it works?

Buyer and seller enter into a business contract. The seller wants a Letter of Credit to guarantee payment.

Buyer applies to his Bank (Issuing Bank) for a LC in favour of the seller.

Buyer’s bank approves the buyer’s credit risk, issues and forwards the LC to the seller’s bank (Advising bank), usually located in the same geography as the seller.

Seller’s bank will authenticate the LC and advise the LC to the seller.

Seller ships the goods, and prepares documentary requirements (invoices, bill of lading, insurance certificate etc) in line with the terms and conditions of the LC.