A letter of credit is a letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. In the event that the buyer is unable to make payment on the purchase, the bank is required to cover the full or remaining amount of the purchase. A letter of credit is often abbreviated as LOC or LC, and is also referred to as a documentary credit. The parties to a letter of credit are usually an applicant who wants to send money, a beneficiary who will receive the money, the issuing bank and the advising bank.

A letter of credit is often confused with a bank guarantee, which is similar in many ways but not the same thing. The main difference is the bank's position relative to the buyer and seller of a good or service in the event of the buyer's default of payment. With a letter of credit, a seller may request that a buyer provide them with a letter obtained from a bank which substitutes the bank's credit for their client's.

With using Ikhtiar's LC, we doesn't take any collateral (cash deposit or asset) at all. Contact us for further details.

Niche: Pinjaman Perniagaan | Kontraktor Pembinaan