Raiffeisen Bank 

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Import documentary letter of credit

It is an irrevocable written commitment by the bank in favour of a supplier of goods or services to pay an amount defined according to the conditions of the letter of credit, provided the letter of credit beneficiary presents identical documents to those required in the letter of credit during its term. In the case of an import documentary letter of credit, the buyer/Raiffeisenbank's client acts as the applicant for its issue.

Benefits

  • There are uniform international rules for letter of credit transactions.
  • Raiffeisenbank guarantees payment by the client/buyer.
  • It guarantees to the client/buyer that payment will be made after compliance with all the conditions prescribed by the letter of credit.
  • The buyer creates pressure on the seller for the delivery to be made at the prescribed time and in the required quality, based on deadlines specified in the letter of credit.
  • The option of variable distribution of the payment of banking charges between the trading partners.

A documentary letter of credit can be used in all situations where documents are expected to be presented in order to guarantee ownership of goods, to document their quantity, quality, etc.

Issuance of import documentary letter of credit

  • Raiffeisenbank issues an import letter of credit based on a request by the client, up to the amount and for the term of the contractually approved conditions.
  • In the request for issuance of a documentary letter of credit, the client specifies the conditions under which the bank can release payment in favour of the supplier (beneficiary).
  • Based on a request presented, Raiffeisenbank concludes a contract with the client on the opening of a documentary letter of credit.

Collateral

The requirements for collateral of a letter of credit will be communicated by the bank to the client in connection with its check on the client’s good standing.



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