|Import Documentary Letter of Credit|
An Import Documentary Letter of Credit (Import L/C) makes it easier for you do to business overseas by reducing risk for your suppliers.
As soon as you have agreed on terms with your supplier you can lodge your Import L/C application with Arab Bank Australia. As Arab Bank Australia will guarantee payment, security is generally required. Please be sure to discuss security with your Arab Bank Australia Relationship Manager, Trade Finance prior to making a commitment to your supplier. Once your credit application is approved, it will be transmitted to a bank in your supplier’s country.
When the credit is received by your supplier they will be required to present the necessary documentation to their banker, which will then be forwarded to Arab Bank Australia. Payment will be debited to your account when Arab Bank Australia receives the complying documentation, or on the maturity date if you have arranged a term drawing and make payment to the supplier on your behalf.
Australian Banks, in common with banks in many other countries, have adopted the International Chamber of Commerce rules as set out in Publication No. 500 – ICC Uniform Customs and Practice for Documentary Credits. These rules set out the procedures to be followed by all parties concerned, including the liabilities and responsibilities of banks and customers involved with documentary credit transactions. They endeavour to eliminate difficulties (created by differences in banking phraseology and procedures) in different countries by setting out standard practices that banks can apply.
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