Letter of Credit

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Title: Letter of Credit

Essay Details:

Subject: Business

Author: Valerie R

Date: July 7, 2014

Level: University

Grade: A

Length: 7 / 2019

Essay text:

It is often used in international trade to eliminate risks such as unfamiliarity with the foreign country, customs, or political instability. Mechanism of Letter of Credit: Here we assume that the payment will be made by the advising bank. Here we go ahead to explain the steps: 1. Here there is a contract between the exporter and the customer in which the need for a Letter of Credit is specified. 2. Then the customer requests his bank to issue a Letter of Credit. 3. Customer’s bank then issues a Letter of Credit via the Advising Bank. 4. Advising Bank then passes on the terms of Letter of Credit to the exporter...

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