Documentary credit is an irrevocable commitment on the part of the importer’s bank, to pay the exporter within a defined and agreed upon time period.
The above is subject to the presentation of documents that are compatible with the terms of credit, by the exporter.
It is customary to work within the framework of documentary credit when the level of trust between the parties is low – unfamiliarity, the first transaction, etc.
This payment method maintains the separation principle – goods against payment.
Neither party to the transaction holds both simultaneously.
With export documentary credit, we can perform a preliminary check of the documents for you to ensure full compatibility with the credit terms.
With import documentary credit, we will adapt the contents and wording to suit your needs.
Exporter, if you plan to receive a future payment as part of a documentary credit, ask us about the possibility of “discounting” the documents so that you can receive the payment in cash.
Would you like to have our commitment in addition to the commitment of the bank opening the credit? Contact us to look into the possibility.
Note that adding “ratification” to banks in many countries, some of which are rated even lower than investment rating, Discount Bank has engaged with the IFC (International Finance Corporation) from the World Bank Group and the EBRD (European Bank for Reconstruction Development).
These international bodies provide us with insurance for business transactions of this type.