Today's global economy mainly depends on overseas import and export business. But dealing with overseas traders brings challenges that aren't typically found in local trade. The major challenge lies in the uncertainty of payment and timely delivery of goods. To mitigate these global trade risks, the ICC introduced Letters of Credit (LC) — a powerful trade finance instrument. In this blog, we will explore the LC definition and how to obtain Letters of Credit.
Letters of Credit is a widely accepted international payment method used by traders to secure global transactions. It is an irrevocable written undertaking issued by a bank on behalf of a buyer, assuring payment to the seller. Once the seller ships the goods and submits the necessary documents as per the LC terms, the payment is released. This dual assurance — of receiving payment and goods — makes LCs highly reliable and in demand.
Since LCs offer confidence and protection for both buyers and sellers, they are considered one of the most essential tools in global trade.
When your bank issues a Letter of Credit, it's essentially assuring the seller that you (the buyer) will fulfill the payment. To do so, banks often require collateral in the form of a cash margin or other guarantees. They may block a portion of your account balance based on the LC value and your relationship with the bank.
If you're a new customer or have limited banking history, your LC request might be declined. Banks prefer customers with a long-standing relationship and strong financial credibility. If you don’t meet the bank’s conditions, you may risk missing important trade opportunities.
To help traders overcome such hurdles, we offer a practical and effective solution to open LCs — without the need for upfront cash or fixed asset guarantees.
As trusted Letters of Credit providers in Dubai, we help businesses close trade deals without delays. We use our existing credit lines with reputable banks to issue Documentary Letters of Credit (DLC) on behalf of your company.
The best part — we don’t require you to block any cash margin or provide collateral. Our DLC process is simple, fast, and designed to help you move quickly on trade deals.
Submit your LC request to us today and get Letters of Credit from highly rated banks within just 48 hours!
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