What are letters of credit?
Sometimes known as a documentary letter of credit, letters of credit (LCs) provide a bank guarantee that the payment for goods to the supplier will follow, covering the outstanding amount of the purchase in the event the importer is unable to settle the debt.
What are the benefits of letters of credit?
- By guaranteeing payment, letters of credit maintain your supplier relationships.
- International finance companies act on behalf of the buyers, ensuring suppliers won’t be paid until the goods are shipped.
- Letters of credit ensure payment will be made on time, avoiding any cash flow problems the importer may experience.
- A documentary letter of credit provides scope for businesses to purchase goods where there is a cash flow gap.
Are letters of credit right for my business?
Letters of credit are just one of a range of international finance services available to businesses that trade overseas. As the UK’s leading invoice finance broker and possessing extensive links across Europe, Hilton-Baird Financial Solutions will assess your individual cash flow requirements and introduce the right solution from the most suitable lender.
Please call 0800 9774833 or email firstname.lastname@example.org to find out more about the advantages of letters of credit. You can also get an invoice finance quote in three easy steps...
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