How is it possible to trade with other countries without opening L.C. (Letter of Credit)? - how to open back to back l/c
What is the replacement for LC?
Monday, January 18, 2010
How To Open Back To Back L/c How Is It Possible To Trade With Other Countries Without Opening L.C. (Letter Of Credit)?
2 comments:
Loc is a very effective way to ensure you pay the shipper. Of course you should not use a letter of credit, you can pay in advance. But then you have no guarantee that the goods are delivered and what is being delivered what was promised. It was included in the quantity and type of insurance? It was sent prepaid if they hired? LOC only guarantee both ends of the transaction.
You can not be responsible for establishing a long-run relationship, where the Chargers and said that the claims and sent to say, OK, I want to wire money.
As a rule, a seller does not extend the line of credit to a buyer. Thus, instead of L / C, you must pay the full amount to the seller in advance. But the danger is great that there will be no guarantee for the buyer ordered goods, if the seller got his money. International law suits are very expensive and very slow to fill.
99.99% of the traders, therefore, is by L / C will be financed, because you get to the bank and the bank of the seller trying to ensure that the goods before the amounts that the seller and the seller is guaranteed to be paid delivered by the bank that the buyer pays shipping the goods. These bankers believe surgery is also known as "the acquired banks. The banks agreed to pay or receive payments in international trade.
It is necessary to establish good credit with your bank to accept the risk of credit or deposit enough money in the bank as collateral for the transaction.
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