Is your company aiming to international market or already established abroad?

  • Documentary credit (or letter of credit) is the safest payment method after advance payment in international business. It is independent irrevocable document issued by the buyer’s bank by the buyer’s request and advised to the seller by the seller’s bank (or some other bank).
  • Turkia Business Consulting offers documentary credit training, coaching and sparring packages tailored for your company’s needs.

Do you use documentary credit as a payment method in your company?

  • Documentary credit is a payment method based on the ICC Uniform Customs and Practice for Documentary Credits (UCP600)

Do you know what kind of documents you need for documentary credit payment?

  • The documents required by the documentary credit are usually the commercial invoice and the transportation documents. The advance payments and project milestone payments can also be charged by documentary credits.
  • The seller ships the goods to the customer. The documents related to the shipment like bill of lading and invoice with other possible documents required by the documentary credit are sent to the issuing bank by the advising bank and the payment is remitted to the seller. Against these documents the buyer is able to claim the goods.

Any need for help with the shipment documents?

  • The shipment documents can be a headache to the inexperienced shipper. Turkia Business Consulting is able to help with these problems in the foreign trade. There are also some international agreements and treaties between countries that should also be paid attention to in order to give benefit to the importer as well.

Have you considered using the standby letter of credit?

  • The standby letter of credit is somewhere between a full documentary credit and a commercial bank guarantee. It is widely used in North and South American markets. The standby letter of credit is irrevocable, but lighter than the documentary credit and it gives the same security as the commercial bank guarantee. Standby letter of credit is based on ICC’s International Standby Practices ISP98. 

What is the meaning of bid bond, advance payment bond, performance bond or warranty bond?

  • In some cases the business agreements require bank guarantees. I can provide training based the usage of the bank guarantees in international trade. What is the maturity period for the guarantees and in which situations the bank guarantees should be obtained.
  • The international tenders require either cash deposit or bank guarantee before a company can enter the bidding competition
  • The buyer may require a bank guarantee to cover the advance payment amount. ICC has published the own set of rules for demand guarantees.

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