Letters of Credit offered in Hong Kong: A helpful overview

Letters of credit might not sound new to your ears if you remain updated about international sales transaction methods. Offered in Hong Kong and other countries, LOC refers to a mechanism of securing international payment transactions.

The rapidly increasing demand for the Letters of Credit in Hong Kong has leaded different NBFCs and banks to provide this.  Before you opt for it for securing your payment, let’s know about LOC in brief.

Letters of Credit in Hong Kong
Learn more about Letters of Credit

It involves the guarantee from the issuing bank. In case the buyer of LOC fails to complete the payment, the issuing bank will pay on his behalf. To make this possible, the buyers require fulfilling all requirements of the letter rightly.

LOC also gives excellent protection to buyers. In case you pay for any product, and the seller can’t deliver the products, SLOC can help. SLOC or standby letter of credit works like a penalty to the seller who was unable to deliver your product.

Different types of LOCs are available on the financial markets creating convenience in the transaction.  Here’s two most widely used amid them.

Import Letters of Credit

In Import LOC or Documentary credit, the issuing bank works on the importer’s behalf. It contractually agrees to pay the exporter or the beneficiary when the conditions of LOC have been satisfied.  

In the case of documentary credits, the NBFCs or banks remain concerned about the documents only, not the goods.

Export Letter of credit

This type of LOC depends on the buyer’s instruction. Here the buyer instructs the NBFC or bank to pay the amount. This one is a globally accepted and popular means of settling trade payments. One interesting feature of Export LOC is, the buyer can’t alter or cancel it without the agreement.

Don’t get bothered about the security of international transactions anymore. Deal with a reputed NBFC or bank and avail the amazing benefits of this useful financial tool.

Get the Letter of Credits from here

In case you are seeking for Letters of Credit in Hong Kong, it’s better to contact a reliable NBFC. Merchant Trade Guarantee Corporation Company Limited can serve your purpose. You can avail of both the Import Letter of Credit in Hong Kong and Export Letter of Credit in Hong Kong from this NBFC. You may click on the link merchanttradecorp.com to gather more information about them.

Location: Hong Kong

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