Get Letter of Credit (L-C) Financing From a Foreign Bank

Letters Of Credit (“L/Cs” for short) are valuable for financing trade activities in import-export, for guaranteeing loans, and for a variety of other financial transactions. To get an L/C or have one confirmed (evaluated as good) take thesesteps now;

  1. Become familiar with an international bank having a strong network of overseas correspondent banks and associates.
  2. Open an account.
  3. Introduce yourself to bank officers and discuss with them your plans to export.
  4. Meet the person in charge of international trade and exports
  5. Ask them about requirements for L/C’s or other available financing

Work with branches of overseas banks having offices in your country. A local branch can speed international transactions considerably.

  1. Insist that the bank have the ability to confirm unconfirmed L/Cs you might
  2. get from overseas. (When a bank confirms an L/C it — in effect — tells you that
  3. the L/C is good and can be trusted.)

When a bank issues an L/C in your favor — you can use the L/C to:

  • Collateralize a loan you get for business or income real estate.
  • Finance your imports which you sell in your own country.

You will be charged a nominal fee — let’s say, $5.00, to get the actual documentation

on the L/C. This amounts to $5.00 per $1000 L/C. Thus, on a $100,000 L/C you’ll pay

$5,000 when the L/C has been in force for one year. This will be about $200 a month.

But during that time you can use the L/C to do any of the transactions mentioned above. The L/C is like an advance confirmation that you can get a loan you can use

to import salable items.

Besides using an L/C as collateral you can also get many other useful services from your issuing bank. Thus, the bank:

  • Can issue valuable trade leads, telling you who’s seeking what products or services in overseas countries around the world
  • Can handle paperwork for loans, imports, exports, and other international transactions for you or your client
  • Can be a valuable international partner anywhere in the world for you or your clients.


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