Are you running an import-export business? Are you going to import goods from your overseas supplier? But are you facing a lack of cash flow or trust to proceed with your deal? Now, you can do your imports & exports with confidence by making use of the Letters of Credit.
Opening Letters of Credit is not an easy task, as banks follow some stringent norms to issue the LC. So, in this blog, we are providing some simple tips that will help you get your LC application approved. Before that, let us discuss Letters of Credit and their definition, the Documents Required for a Letter of Credit & How to Apply for LC at ZERO Collateral.
Businesses searching for a Letter of credit provider at Dubai can access suitable LC solutions for their import and export requirements. A reliable Letter of credit provider Dubai helps traders understand LC processes and documentation. Choosing the right Letter of credit provider Dubai can support smoother international trade transactions.
What are Letters of Credit?
A Letter of Credit is basically an undertaking by a bank on behalf of the buyer, which assures payment to the seller within a specified time, against the presentation of documents strictly in compliance with the terms stated in the issued MT700. Nowadays, LCs have become vital aspects of safeguarding trade transactions, due to differing laws in each country and the risks involved in dealing with unknown parties.
A Letter of Credit is also called LC MT700, DLC, or LC at Sight. LC works in favour of both buyer & seller. By using LC as the payment term, the seller gets assured that if they present the documents on time as stated in the issued LC, then they shall receive the payment for the supplied goods without any default. On the other hand, the buyer is assured that the bank will release the payment only after the thorough evaluation of the presented shipping documents. So, using MT700 reduces the risk of paying the supplier without receiving the goods.
Businesses looking for a Letter of credit provider in Dubai can contact Bronze Wing Trading to discuss their LC requirements.
Documents Required for LC Application
To start with your LC application, you need to keep the following documents ready:
- Pro-forma invoice or signed SPA of your trade deal
- Copies of Company Registration, i.e., Trade License, or Company Incorporation Certificate
- Latest 6 Months Bank Statement
- Passport Copies & Utility Bills of the Authorized Signatory to prove Residence and Company Address
If you have all these documents in hand, then you can move on to the next step of LC opening. Also, if you contact your bank to open LC, along with all these papers, your bank will demand a 100% cash margin to proceed further. In case you don’t have enough cash funds to provide as a cash-margin, your request may be declined.
But we are here to support you by getting your LC request approved within 24 hours! Our international import finance support can help eligible businesses explore suitable LC facilities for their import transactions.
LC Application at ZERO Collateral
Even if your bank declined your LC request, we can provide LC from our bank account with reputed banks at ZERO Collateral. All you need to do is submit your MT700 request to us along with the pro-forma invoice or SPA for your trade deal. Then, our team will review your request & come back to you with a Free Quote.
If you are ready to move ahead with our proposal, we will start working on your LC transaction with our bank. Further, we will provide the DLC issued in 48 working hours from our bank accounts. Unlike banks, we will not ask for any cash margin. We can extend our own facilities available with European Banks & will provide the DLC on behalf of your company at minimum service charges.
Contact Bronze Wing Trading L.L.C., Letter of credit provider UAE, to discuss your LC requirement in detail for your trade deals!