de prêts pour les PME
Borrower’s Procedures – a Broker´s Fantasy
Joint Venture Funding – How to Present Your Project to Get Funded
DL Financial Ltd Welcomes you to the last quarter of 2015, the defacto year of Joint Venture (JV) financing. Institutional financing is not available so developers are looking outside the box to fund their projects. The most common form of favorable financing is JV. This financing comes in more shapes, sizes, and terms than colors of the rainbow. There are, however, a few common things that all JV funders look for, regardless of the project, location or dollar amount. The purpose of this article is to share with you what these common denominators are and how you should present your project to get the most favorable terms.
Let’s look at this from your potential funder’s perspective. What does he want? The answer is simple, but arriving at achieving his goals involves a tremendous amount of scrutiny and due diligence on you, the developer. Quite simply, the JV funder wants a return on his investment. You must speak his language. What he wants is a pro forma that shows what his internal rate of return (IRR) is at two and five years. If you cannot prepare one of these, find someone who can. This document or spreadsheet shows vision and the common goal of making money.
Everything else is secondary, but also very important. You need to prepare a package that consists of the following items:
- an executive summary of the project that is no more than 5 pages (no funder will read a 120 page business plan before reading an executive summary)
- the proforma
- bios and resumes of all of the key players, including your contractors
- the entire business plan
- an appraisal if you have one
Logically, the funder has the money. You have to prove that you have the brains, muscle and integrity to be a great and cooperative partner. Your opportunity is not the only one on his desk, but it will certainly be the most presentable. Sloppy presentations make for sloppy projects.Finally, the worst thing you can do is put pressure on the funder to act or fund immediately. Desperation only indicates weakness and poor planning.
Financial Banking Instruments for Lease and Sale (BG/SBLC/LC)
Dear Partners/Associates,
We offer Legitimately Cash & Asset Backed Financial Instruments on Lease and Sale at the best rates and with the most feasible procedures. Instruments offered can be put in all forms of trade and can be monetized or discounted for direct funding.
We are genuine and the most reliable providers in Europe, we offer certifiable and verifiable bank instruments via Swift Transmission.
GENUINE BANK GUARANTEE (BG) AND STANDBY LETTER OF CREDIT (SBLC) FOR LEASE AND SALE AT THE LOWEST RATES AVAILABLE. OTHER FINANCIAL INSTRUMENTS SUCH AS MTN, CD, DLC, PB ARE ALSO AVAILABLE.
Kindly contact us today for genuine inquiries and I can provide you with the needed information.
Mr. Laurent De Landtsheer
Skype: dl.financial.limited
Website: http://www.dlflimited.net/
Blog: https://dlfinancial.wordpress.com
EMAIL: info@dlflimited.net OR credit.finance2012@gmail.com
What is a Bank Guarantee?- Understanding BG and its uses
The term “bank guarantee” has no precise definition, particularly in international law. Some use the term exclusively to describe a transaction in which one party makes an independent guarantee commitment in respect of another party’s liabilities, regardless of the latter’s form and enforceability. Others describe guarantees as all transactions in which security is offered; from letters of comfort (which often are morally binding at most) to surety bonds and abstract payment undertakings.
A Bank Guarantee can be described as a Letter of Guarantee issued by one bank to another bank to guarantee the performance of an obligation on the part of the applicant, guaranteeing the beneficiary.
A Bank Guarantee is where one Bank (the Issuing Bank) issues an indemnity to another Bank (the Beneficiary Bank) or directly to a Beneficiary, on behalf of its account holder. The Issuing Bank will expect its account holder to pledge ‘assets’ to the bank for its issue.
Bank Guarantee’s take many forms.
Some Guarantees are written to guarantee rental payments, some are written to guarantee payments upon the meeting of certain conditions. Some are even issued to guarantee loans and credit lines. All of them are written for a specific purpose to a specific party.
Each Bank Guarantee will be worded for the purposes it is intended. Some may be ‘callable upon demand’ or some may only be ‘callable’ when the Beneficiary provides notice of satisfaction of a pre-determined condition.
Currently, under the new Uniform Rules for Demand Guarantees (URDG 758) an underlying contract should be provided that states clearly the purpose of the Bank Guarantee and forms part of the Guarantee, for example a Rent Agreement or Payment Obligation.
In international trade dealings, buyers and sellers often experience problems of trust within each other to honor their payment obligations. A seller may find it difficult to ascertain the buyer’s willingness and ability to make payment, whilst the buyer may not be convinced that the seller genuinely intends to perform his side of the agreement or has the necessary financial and technical resources to do so. Just as the buyer needs protection against non-performance, so the seller will want to minimize or insure against the risk of non-payment. Documentary credits are generally used in such cases, yet various other forms of bank guarantees are available.
The common element in all these arrangements is that the guarantor undertakes to be answerable for the payment of a debt or the fulfillment of a payment obligation in the event of default by the party that is responsible for it.
DL Financial Limited are direct provider of bank Guarantees (BG), SBLC, DLC and All other types of Letters of Credit. We are legally registered Financial Firm with good reputation. We only work with Top Prime rated global banks.
We deliver with time and precision as set forth in the Deed of Agreement (DOA). All our customers can engage our leased bank instruments into trade programs, Business expansion projects, Aviation projects, Agricultural projects, Petroleum/Oil/Gas, Telecommunication, Construction Projects and any other turnkey project. Our terms and Conditions are reasonable.
DESCRIPTION OF INSTRUMENTS:
1. Instrument: Bank Guarantee (BG)/SBLC
2. Total Face Value: Eur/Usd 1M MIN and Eur/Usd 50B MAX).
3. Issuing Bank: HSBC, Barclays Bank, Standard Chartered, Citibank or AA rated Bank in Western Europe or USA.
4. Age: One Year, One Day
5. Leasing Price: 4% of Face Value plus 1% brokers commission (only if there is a broker involved in the transaction)
6. Delivery SWIFT TO SWIFT.
7. Payment: Wire Transfer.
8.. Hard Copy: Bonded Courier within 7 banking days.
All relevant information will be provided to any serious customer upon request.
Please forward all your inquiries & consultations to our contact details as follows:
DL Financial are NOT Brokers! We Are Direct Providers of Loan, BG, SBLC, DLC & Project Funding
We are NOT Brokers! DL Financial Limited are Direct Genuine Bank Guarantee Issuers, monetizers and discounters.
Direct means….. There is no Broker between us and the you the customer, we have open direct unrestricted access to the most reputable prime Bank Guarantee and SBLC issuing banks in the world.
DL Financial has forged close committed, long term relationships with large wholesale service providers, BG Issuers and Monetizers who want to focus on transacting deals not running a retail store front and dealing with a wide cross section of difficult, demanding and often uninformed customers.
So DL Financial has became the central focus, we now handle all client liason, we prepare, arrange, issue and in most cases draft all the BG Issuing and BG Funding contracts.
We deliver the front end, our wholesale suppliers deliver the back end. It is the perfect partnership and synergy, each focusing our time and attention on our core strengths and being able to smoothly and efficiently close client deals.
There is no Broker Joker BS with us, our motivation is to work with clients and get the deal closed. There are no Broker Games, No Middle Men, No one that stands between us, the customer and the issuing banks.
We are pure and simple the Agreement Issuers and the Dealmakers for the Entire Process!
We happily pay all brokers who refer business to us but we are not brokers ourselves. So when your tired of 9000 Brokers and 1000 Scammers and you want to get something real completed, email us immediately. We look forward to being of service to you.
DL Financial Ltd issues Real Bank Guarantees, real and genuine SBLC’s and completes Real Funding without long stories!
Others Talk, but DL Financial Delivers. If you are tired of brokers and scammers cheating you and telling you stories and no one ever delivering what they promised, maybe its time you became a customer of DL Financial Ltd.
Top 5 Credit Cards For the Super Rich ONLY
For people of average wealth, credit cards are ways to get by when money is tight, make additional purchases or to earn generic rewards. Credit cards give the super-rich power, incredible perks and help them further fund their extravagant lifestyles. Many of these exclusive credit cards come only through invitation or by achieving specific benchmarks.
1. American Express Centurion Card
The American Express Centurion Card is the most exclusive credit card in the world and is commonly known as the original black card. Launched in 1999, American Express has kept it in a shroud of uncertainty, giving it a very high level of status in the minds of consumers. The company won’t release the full details of the card or how one can become a cardholder, but a few criteria have been leaked.
Before even applying to own this card, a person has to be an American Express Platinum cardholder for at least one year. The cardholder must charge at least $250,000 on the Platinum card in one calendar year. Then, if a cardholder is lucky enough to be invited to apply for an American Express Centurion Card, she will need to pay an initial fee of $5,000 and an annual fee of $2,500.
With these criteria and fees come some very nice perks. The American Express Centurion Card provides access to a 24-hour concierge service, flight upgrades, complementary hotel rooms, personal shoppers and the ability to close a retail store for personal shopping.
2. JP Morgan Chase Palladium Card
The JP Morgan Chase Palladium credit card is made of laser-etched palladium and gold, and it is reserved for consumers who have a relationship with JP Morgan’s private bank, wealth management or investment bank. Unlike the American Express Centurion Card, this card has an annual fee of only $595 and has no prior spending requirement.
The JP Morgan Chase Palladium card offers its cardholders a very high rewards program. Each dollar that a cardholder spends on travel results in two points toward the card’s reward benefits. Cardholders also receive a 35,000 point bonus after spending $100,000.
3. Dubai First Royal MasterCard
The Dubai First Royal MasterCard is trimmed in gold, with a .235-carat diamond in the center of the card. Consumers must receive an invitation from Dubai First to become cardholders.
The card comes with some amazing perks. Cardholders have access to a team of 24/7 lifestyle managers whose sole purpose is to meet the cardholders’ every request. Additionally, the card has no credit limit and zero restrictions, allowing cardholders to spend as much as they want.
4. Stratus Rewards Visa Card
The Stratus Rewards Visa is a card that tries to differentiate itself from other elite cards, even down to its color. The bright white card is available to high-net-worth individuals (HNWIs) only through invitation. However, these individuals can pool their rewards points together to use toward private jets and other perks, an option exclusive to this card.
These other perks include personal concierge services, discounted charter flights, car services, upgrades at luxury hotels, merchandise discounts and consultations with lifestyle experts. The card has a $1,500 annual fee.
5. Coutts World Silk Card
Queen Elizabeth II uses the Coutts World Silk Card, as do least 100 other people who have $1 million or more in a Coutts account. Known as England’s most exclusive credit card, the Coutts World Silk Card comes with a 24/7 concierge service, access to exclusive airport lounges and private shopping at designer stores. However, the credit card has an extremely high annual percentage yield of 49.1%, prompting cardholders to pay off balances quickly.
We Are Providers of Loan, bank guarantees & SBLC (https://dlfinancial.wordpress.com)
Financial Instruments- International Structured Trade Finance
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MT 103/23????
A standard SWIFT MT103 (Single Customer Credit Transfer) is a general use message of a TT payment instruction which is an unconditional payment.
I would like to confirm that there is no MT103/23 Conditional, but MT103 (usually with Field 23B – bank operation – mandatory codeword CRED), Field 23E – Instruction Code – is where the remitting bank (at the request of the remitter) puts in instructions code instructing the beneficiary’s bank how to effect the payment.
MT 103 in Field 23E specifies an instruction which must contain barely one of the following SWIFT – STP (Straight Through Processing)– Optional/Conditional – just four digits SWIFT -STP accepted codeword:
SDVA: Payment must be executed with same day value to the beneficiary.
INTC: The payment is an intra-company payment, i.e., a payment between two companies belonging to the same group.
REPA: Payment has a related e-Payments reference.
CORT Payment is made in settlement of a trade, e.g., foreign exchange deal, securities transaction.
BONL: Payment is to be made to the beneficiary customer only.
HOLD: Beneficiary customer/claimant will call; pay upon identification.
CHQB: Pay beneficiary customer only by cheque. The optional account number line in field 59 must not be used.
PHOB: Please advise/contact beneficiary/claimant by phone.
TELB: Please advise/contact beneficiary/claimant by the most efficient means of telecommunication.
PHON: Please advise account with institution by phone.
TELE: Please advise account with institution by the most efficient means of telecommunication.
PHOI: Please advise the intermediary institution by phone.
TELI: Please advise the intermediary institution by the most efficient means of telecommunication
…. A so called “MT103/23 conditional payment” is a format which would not be recognized by banks.
You cannot send an MT103 with a condition that the beneficiary’s bank must receive, say presentation – evidencing of certain advisable documents detailed in Field 23E – from the beneficiary before crediting his account.
Such any other message (except merely SWIFT – STP four digits codes) stated by Field 23E will be rejected by the remitting bank, and if sent in Field 23 (which allows for only a few standard codes described above) will be rejected and ignored by the beneficiary’s bank who will credit the beneficiary’s account anyway.
It must be understood that other such messages are not governed by any ICC or SWIFT – STP provisions, and the manual intervention required under the “CONDITIONAL PAYMENT” flag would affect the “Straight Through Processing” (STP) function of the SWIFT MT103 message.
It is unlikely that the – SWIFT payment department – of a bank would wish to involve itself in an area for which it is not qualified, in determining the integrity of the underlying documents, and thereby lift the condition to pay the recipient.
Now for those who request a MT 103/23 , send it to me and see if it works! stop the madness already! Its not easy educating uninformed customers.
Letters of credit providers- L/C, DLC, SBLC and lease bank guarantees
Letter of credit (Documentary Letter Of Credit (L/C, DLC) is the bank’s obligation to pay the seller of goods or services a certain amount of money in the timely submission of documents confirming shipment of goods or performance of contractual services.
Documentary Letter Of Credit is one of the most important means of financing in the international trade, as the letter of credit is a tool that removes most of risks as from the buyer (importer) and from the seller (exporter).
Documentary Letter Of Credit is very flexible and convenient tool of calculations, which have the widest recognition and acceptance in the world because of the following advantages:
- For the seller, the letter of credit is convenient because it removes the risk of insolvency of the buyer, because the letter of credit is the unconditional obligation of the bank to pay, regardless of the presence or absence of the bank of the applicant credit. Thus, the letter of credit provides a higher degree of protection of the seller’s interests with payment upon delivery or by collection.
For the seller of credit is convenient because it removes the risk of insolvency of the buyer, because the letter of credit – the unconditional obligation of the bank to pay, regardless of the presence or absence of the bank of the applicant credit. Thus, the letter of credit provides a higher degree of protection than the interests of the seller with payment upon delivery or by collection.
- For the customer the letter of credit is convenient because it provides greater protection of the buyer’s interests compared to the down payment, and eliminates the risk of unscrupulous sellers, because the letter of credit may be required, among other documents, the documents, issued by independent third parties (Chamber of Commerce, the insurance company, the independent inspector).
- Availability of “Uniform Rules and Practice for Documentary Letter of Credit”, which are internationally recognized, clearly defining and delimiting the obligations of the parties of the letter of credit, allows advancing the interests of the applicant or beneficiary. Thus, the letter of credit is the bank’s obligation as an independent arbitrator who shall be subject to payment of the letter of credit, regardless of the possible litigation between the parties to the contract.
The principle of autonomy and independence of the letter of credit from the contract is fundamental.
What should be important during choosing a letter of credit:
It is important to define clearly the conditions of the letter of credit: type of the letter of credit, payment conditions of the letter of credit, a list and description of the documents submitted by the payee and the requirements for such documents, the closing date of the letter of credit and the period of submission of documents.
There are the following forms of letter of credit:
Revocable Letters of Credit, which can be changed or canceled by the issuing bank without prior notice to the recipient of funds. Revoke of letter of credit does not create any obligation of the issuing bank to the payee (Article 1094 Civil Code). Nominated bank is obligated to make a payment or other operations on a revocable letter of credit, if at the time of their commission they have not received notice of the change of conditions or canceling credit. A letter of credit is revocable if its text does not explicitly state otherwise.
Irrevocable letter of credit is a firm obligation of the issuing bank to pay money in order and the terms defined by the conditions of the letter of credit, if the documents provided for by it, submitted to the bank specified in the credit, or the issuing bank, and observe the terms and conditions of the letter of credit.
Irrevocable letter of credit guarantees that the exporter will make payment to the performance of its obligations, even if an importer wants to abandon the deal. Therefore, exporter, performing a special order, for which most likely will not be another buyer, chooses exactly this kind of letter of credit.
Irrevocable unconfirmed letter of credit. When making an unconfirmed letter of credit issuing bank, providing a letter of credit, is only party that is responsible for the disbursement to seller. Nominated bank has to pay only after receiving the money from the issuing bank. Nominated bank simply acts on behalf of the bank providing credit, so it does not take any risk.
Irrevocable confirmed letter of credit – the obligation of the issuing bank is confirmed by another bank. Confirmation is an additional guarantee of payment from another bank (Bank of the exporter or prime bank).
Bank, confirming letter of credit is committed to pay for documents according to the conditions of the letter of credit if the issuing bank fails to make the payment.
According to the method of payment letters of credit can be divided into the following types of letters of credit:
1.Transferable Letter of Credit (Transferable LC) is a letter of credit, the beneficiary of which is entitled to instruct the advising bank to transfer the letter in full or in part to another person with the preservation of the conditions of the letter of credit. Transferable letter of credit may be transferred only once (if in the Credit otherwise is stated). Prohibition on transfer of letter of credit is not a prohibition on assignment of revenue on it. Letter of credit can be transferred only if it is clearly defined by the issuing bank as a transferable. The term “divisible”, “fractional”, “assignable”, “passed” and others do not give the right to consider the letter of credit as transferable. This type of letter of credit is applied when in the transaction between the seller and buyer the intermediary participates who has a letter of credit opened in his favor and transferred into its own provider. The letter of credit can be transferred only under the conditions specified in the original letter of credit, with the exception of the amount of the credit, the unit price, which can be reduced, as well as the expiry date, the last date for submission of documents after the date of shipment, shipment period, which may be reduced. During transferable letter of credit the documents should be requested so that they could be used for the initial credit. The use of this type of credit requires caution and a good knowledge of technology.
- Red clause Letter of credit. The essence of red clause letter of credit is that letter of credit requires the terms and conditions of a special clause, according to which the issuing bank authorizes the nominated bank to make an advance payment of a specified amount to the beneficiary before submitting all the documents under the Credit (prior to shipment of the goods or services). Such clause is included in the letter of credit at the request of applicant. Down payment on red clause letter of credit made by the executing bank under a written obligation of the beneficiary to submit documents in accordance with the terms of the letter of credit. After the submission of all documents executed in full. A letter of credit is named in such way because special clause was done with a red stripe.
3.The letter of credit with Payment at Sight. Beneficiary receives payment upon presentation and verification of documents corresponding to all the conditions of the letter of credit. It is provided a reasonable time for a document check before paying to the issuing bank, confirming bank or an authorized bank.
4.The letter of credit with Deferred payment. Letter of credit with Deferred payment is based on an irrevocable commitment of the issuing bank and / or confirming bank to make payment against presentation of the relevant documents not at the time of presentation of the documents and in the corresponding period of payment, determined by the conditions of the letter of credit. Letters of credit (with Deferred payment and payment by acceptance) may be a more attractive financial instruments to customers prior to the date of payment the buyer can sell the goods and pay the letter of credit, generated profit.
- Revolving Letter of Credit (Revolving LC) put up on a certain amount, after which it will be used for some time, again exposed for the payment of claims of the beneficiary as many times as is reached set the maximum aggregate limit.
The advantage for the importer is that it can order the product in quantities greater than it needs at the moment, and thus to secure a better purchase price. In this case, the delivery of goods will be divided into certain parties and must be performed at specified intervals. For exporter to ship on a schedule convenient for the importer, usually under the revolving credit indicating the dates of the respective amounts which represent the proportion of the aggregate limit.
Such statement about the date of the equity amounts forces an exporter to ship goods in time in accordance with the agreed schedule, otherwise unused equity amounts simply void, unless otherwise isn’t stipulated in the letter of credit, that is for a further letter of credit they will be impossible to use. In this case we are talking about the “non-cumulative Revolving Letter of Credit.”
If the amounts that were not used in fixed terms for them, however, are allowed to use in the future, in which case we are dealing with a “cumulative Revolving Letter of Credit.”
Revolving Letters of Credit are useful only for transactions in which the same type of product will be delivered at regular intervals to the same counterparty.
6.Stand-by Letter of Credit (Stand-by LC) was developed by the American banking system and performs the same functions as a bank guarantee. Using a Stand-by Letter of Credit is regulated by the ISP98, and UCP 600.
Stand-by Letter of Credit is a bank’s obligation to make payment in the event of default on the part of the Applicant, and is a bank guarantee. Typically, this letter of credit is opened in cases where the contract provides for payment for goods by bank transfer or otherwise, not giving an absolute guarantee of payment, and the exporter wants to protect himself, but the bank guarantee is forbidden, then in the contract the parties stipulate that as security the letter of credit will be Stand-by by the importer. Payment under this letter of credit will be made in the event of non-payment by bank transfer or otherwise, in unintended ways, on presentation of documents by the beneficiary and the special statement indicating that the counterparty (applicant for the credit) has not fulfilled its obligations in respect of payment.
The use of the term “stand-by letter of credit” is explicated in such way that the law of some states in the U.S. prohibits banks to provide guarantees, and the International Chamber of Commerce Uniform Rules for Documentary Credits under the influence of U.S. banks recognizes the application of these rules for stand-by letters of credit (Article 1). From this position, their use is preferable to a bank guarantee, which are subject to national legislation.
In recent years, access to the banks to provide credit guarantee becomes frequent, which would support the borrower’s obligation to pay to a third party or a promise to fulfill certain contractual obligations. This can be done with the help of letter of credit.
Beneficiary under a stand-by letter of credit is drawn firstly to the applicants for payment and then asks the bank to make a payment. For commercial letter of credit situation is reversed, “the beneficiary receives payment from the issuing bank, without resorting to the buyer for payment.”
Thus, as well as a guarantee, stand-by letter of credit is irrevocable obligation of the bank to pay a specified amount of stand-by letters of credit in the first written demand of the beneficiary in the event of default by a party under the Contract, subject to all conditions of the credit.
7.Back-to-back letter of credit. The letter of credit is opened by the issuing bank at the request of the client-applicant in the event of another open letter of credit in favor of the client, in which he is a beneficiary. In contrast to the transferable letter of credit, basic and back-to-back letter of credit are two legally independent from each other letters of credit, even though both are designed for the same commodity transactions.
Back-to-back letter of credit is effective in cases where the seller does not want the proxy provider to know the end customer, and vice versa. In this case, the terms of a letter of credit opened in the name of the broker, may be moved to credit, which will open in the name of an intermediary third party transactions, both credit will be run independently of each other, and the terms of a letter of credit may differ if it is necessary.
This type of credit is usually used by middlemen.
In the CIS countries to open such credit, the banks generally require collateral or broker deposits to lower the risks.
Payment mechanism
- Importer (buyer) has a guarantee that the bank will not pay for his account as long as he doesn’t receive documents in accordance with the terms of the letter of credit and is satisfied that received documents by the external signs meet the requirements of the importer.
- Banks will deny payment of documents by the importer, if the documents on the goods do not meet the letter of credit, thereby protecting the interests of the importer.
- Customer can be sure of receiving payment as soon as he provides the documents to the bank according with the letter of credit.
- Customer receives against the shipping documents, specified in the letter of credit, prompt payment (if the letter of credit provides for payment terms – on demand).
- Required documents usually include shipping documents such as bills of lading (receipt of shipmaster) goods and transport waybill, duplicate w / a bill showing that the goods have been shipped in accordance with the needs and specification of the buyer.
Letter of credit in most cases is as follows:
- Exporter and importer agree to the release of LC (Letter of credit).
- Importer (the buyer) with the consent of the exporter (seller) asks his bank to issue a letter of credit. The importer’s bank (the issuing bank) in such case assumes an obligation to pay a fixed amount to the exporter with the condition that the exporter will provide the documents that match the letter of credit for a specified period of time.
- Bank issuing informs the bank of the exporter of the credit.
- Bank of the exporter (advising bank informs the exporter that, the letter of credit is issued on his advantage).
- Exporter ships the goods, prepares the necessary documents and send them to the bank for providing in the designated bank.
- Designated bank verifies the documents and if the documents are in compliance with the terms and conditions of letter of credit, this bank will pay the amount of the documents, but not exceeding the total amount of the letter of credit.
- Designated bank sends the documents to the importer’s bank for onward transmission to the importer, who can use them to get the goods.
General advantages of the letter of credit
1.Letter of credit is very flexible computational tool that can be used for payment transactions on a variety deals of clients.
2.Letter of credit is a tool, the rules of using of which are defined in the authoritative international organization, are common and are recognized all around the world. This is beneficial to both customers and banks, as each party of the transaction has a clear understanding of rights, responsibilities, and standard requirements to all participants in the operation.
3.Letter of credit is useful as a tool for short-term financing.
Advantages of the letter of credit for importers
1.Letter of credit may open by own expense of the client, by funds provided by the bank on credit, as well as by providing support by customer to fulfill its obligations (mortgage, deposit).
2.Payment is performed after shipment of goods and delivery of documents.
3.Importer determines a list of the documents against which will be issued payment.
4.Limit the period of providing of the documents and shipment of goods.
Advantages of the letter of credit for exporters
1.To the obligation of the buyer to pay, it is added an obligation of the issuing bank, this liability does not depend on the relationship between the seller and the buyer.
2.If the letter of credit is confirmed, so there is a guarantee of payment from the second bank.
3.Performance of the letter of credit is a guarantee of payment.
The similarities between the letters of credit and guarantees
1.Letter of credit and guarantee are due to the existence and the need to secure the obligations of partners in a transaction.
2.Letter of credit and guarantee are the bank’s obligation to make payment to the beneficiary against certain documents;
3.Letter of credit and guarantee are paid during the provision to the bank well-defined and clearly understood terms of those instruments of documents.
4.Commercial banks offer guarantees and letters of credit on the base of written confirmation of the presence of obligations in the applicant that are provided by such guarantees or letters of credit (the contract, etc.).
The differences between the letters of credit and guarantees
- Letter of credit is opened with the intention of using it, that is, payment by letter of credit is a phenomenon that occurs during the normal course of events (method of payment). Guarantee is used as a way to ensure obligations and is used if in the process of the implementation of one of the parties of the transaction is not able to meet its own obligations.
- Letter of credit is used as a method of payment in one form or another. The guarantee can cover almost any kind of obligations (the advance payment guarantee, performance of contractual obligations, tender obligations, repayment, payment of customs duty, payment of a fine or compensation fixed by the court, the observance of the guarantee period of equipment, guarantee of the payment of court collateral, guarantee of payment of the transfer a football player and many others.) Area of application of guarantee, thus much wider than in credit.
- Letter of credit is a transferable tool, as it allows to optimize the calculations between the partners. Guarantee in rare cases can be transferable as all that is required to receive funding under the guarantee is the requirement of payment, which makes it a ground for abuse of this tool.
DL Financial Ltd issues Real Bank Guarantees, real and genuine SBLC’s and completes Real Funding without long stories!
DL Financial Limited (DLFL) are genuine and reliable providers of loan, international project funding, Lease bank guarantee providers, buy, lease or rent sblc, dlc and all letters of credit. Kindly contact us today for all your financial needs.
Skype: dl.financials.limited
Email: info@dlflimited.net
Website: http://www.dlflimited.net
Twitter: https://twitter.com/dlfinancial
DL Financial Ltd. 