Export Letter of Credit Services
• Letter of Credit Advising Services
Service Overview
- The Bank provides L/C advising and L/C Amendment advising services to sellers when the buyer and seller agree to settle payment for goods by L/C.
- The seller must instruct the buyer to issue or amend the L/C by appointing Land and Houses Bank* as the Advising Bank.
- After the buyer’s bank issues or amends the L/C and sends it to Land and Houses Bank, the Bank will authenticate the L/C, advise the seller, and make it available so the seller can proceed with shipment.
Key Features
- Advises L/Cs issued by buyer's bank through a worldwide correspondent banking network.
- Prompt L/C notification by telephone or email after the Bank receives and authenticates the L/C.
- Secure custody of the original L/C to prevent loss.
Benefits
- Assurance of receiving an accurate and authentic L/C from buyer in overseas
How to use the servicess
1.) The Bank receives and authenticates the L/C and advises it to the beneficiary.
2.) The beneficiary settles the applicable charges and receives the advised L/C.
3.) The beneficiary reviews the L/C terms and conditions and, if necessary, requests the applicant to arrange an L/C amendment.
• Letter of Credit Confirmation Services
Service Overview
- The Bank provides L/C confirmation services to sellers concerned about receiving payment due to the credit standing of the issuing bank or the country in which it is located.
- The seller must instruct the buyer to issue an L/C appointing Land and Houses Bank* as the Advising Bank, Confirming Bank, and Negotiating Bank, with payment subject to Reimbursement terms.
- Once the seller presents compliant collection documents under the L/C, Land and Houses Bank will make payment if the issuing bank is unable to do so.
Key Features
- Confirms payment under L/Cs issued by issuing banks globally.
Benefits
- Enables goods to be manufactured or shipped with confidence that payment will be received.
- Reduces the risk of non-payment by the L/C issuing bank.
- Supports expansion of the seller’s customer base through sales under L/Cs to counterparties worldwide, including new, higher-risk markets.
How to use the servicess
1.) The Bank receives and authenticates the L/C issued by the issuing bank and advises the L/C to the beneficiary.
2.) The beneficiary submits a Payment Instruction for L/C Confirmation together with the original L/C and any amendment(s), if applicable.
3.) The Bank reviews the terms and conditions of the L/C, as well as the financial institution credit limit conditions of Issuing Bank.
4.) Upon approval, the Bank advises the beneficiary of the confirmation and collects the applicable L/C confirmation commission and charges as agreed.
• Export Documentary Collection Services under L/C
Service Overview
- The Bank examines export documents presented under the L/C for completeness and accuracy, then forwards them to the issuing bank for collection and follows up on payment status or messages from the collecting bank.
Key Features
- The Bank follows up on payment and will pay the exporter upon receipt.
Benefits
- Documents are reviewed by experienced international trade specialists.
- Dispatch of collection documents, together with efficient collection follow-up.
How to use the servicess
1.) The Bank receives the export documents under the Export L/C from the beneficiary and examines the documents for compliance with the terms and conditions of the L/C.
2.) The Bank sending the documents to the issuing bank for presentation and payment, and follows up on the payment status.
3.) Upon receipt of payment, the Bank credits the proceeds and notifies the beneficiary accordingly.
• Transferable Letter of Credit Services
Service Overview
- The Bank provides documentary collection services under a Letter of Credit (L/C) for sellers who have shipped goods and submit documents through the Bank to collect payment from the L/C issuing bank acting on behalf of the buyer.
- The Bank examines the documents for compliance with the L/C terms and conditions, enabling the seller to correct any errors that could result in payment refusal before the documents are dispatched for collection.
- Once the L/C issuing bank remits payment to Land and Houses Bank, the Bank will notify the seller of the collection result and credit the proceeds to the seller’s account.
Key Features
- Fast, accurate, and reliable service
Benefits
- Assurance that collection documents comply with the L/C terms and conditions, reducing the risk of payment refusal.
How to use the servicess
1.) The beneficiary of a Transferable L/C submits an Application for Transfer of Documentary Credit together with the original L/C.
2.) The Bank reviews the transfer instructions and the terms and conditions of the L/C, effects the transfer, and advises the transferred L/C to the transferee.
3.) The Bank collects the applicable transfer commission and charges from the transferor or transferee, as agreed.
4.) The Bank provides the transferee with the Transferred L/C advice and a copy of the original L/C.
5.) The original L/C will be released upon full utilization of the credit or upon expiry of the Transferred L/C.
• Assignment of Proceeds under Letter of Credit
Service Overview
- At the request of the Assignor (the seller or exporter), the Bank provides an Assignment of Proceeds service for trade collection documents under a Letter of Credit or Bills for Collection, transferring the right to receive proceeds to the Assignee.
- Trade collection documents are submitted through the Bank for collection.
- After receiving payment, the Bank credits the Assignee’s account with the portion specified in the Assignment of Proceeds and credits any remaining balance to the Assignor’s account.
Key Features
- Allows the assignment of proceeds to multiple beneficiaries.
Benefits
- Provides the Assignee with assurance that funds will be received when payment is made under the trade collection documents.
- Eliminates the need to prepare a separate funds-transfer agreement and arrange payment to the manufacturer.
- Creates market opportunities for sellers whose production capacity is insufficient for their order volume by enabling them to engage other domestic manufacturers.
How to use the servicess
1.) Submit an Application for Assignment of Proceeds together with the required supporting documents as stipulated on L/C, including:
2.) Commercial documents (e.g., Invoice, Packing List).
3.) Transport documents (e.g., B/L, AWB).
4.) Bill of Exchange.
• Export Bills for Collection Services
Service Overview
- A service for sellers to collect payment from buyers by B/C. After shipping the goods, the seller compiles the trade documents and submits them to Land and Houses Bank for onward delivery to the buyer’s bank. The buyer must fulfill the stipulated conditions before receiving the documents. These conditions generally fall into two categories:
1.) Documents against Payment (Documents against Payment: D/P)
2.) Documents against Acceptance (Documents against Acceptance: D/A)
- Once the buyer’s bank receives payment and remits the funds to Land and Houses Bank, the Bank will notify the seller of the collection result and credit the proceeds to the seller’s account.
- Bills for Collection (B/C) is a trade payment arrangement whereby, after shipping the goods, the seller compiles and sends the trade documents to the buyer through banks. The buyer or importer must fulfill the stipulated conditions before receiving the documents.
Key Features
- The Bank assists in monitoring and following up on outstanding payments with the buyer's bank until settlement is received.
Benefits
- The Bank monitors and follows up on outstanding payments and remits the proceeds upon receipt. Collection efforts continue until payment is received or the matter is otherwise resolved.
How to use the servicess
1.) The Bank receives Bills for Collection from the exporter.
2.) The Bank sends the collection documents to the buyer through the collecting bank overseas.
3.) Upon payment or acceptance under D/P or D/A terms, the Bank credits the proceeds to the exporter’s account.
4.) The Bank provides collection follow-up services for unpaid bills.
• Negotiation and Discounting of Export Bills
Service Overview
- The Bank provides short-term financing to sellers who have shipped goods and submitted collection documents to the Bank under either a Letter of Credit (L/C) or Bills for Collection (B/C). Financing is extended based on the value of those documents.
- Land and Houses Bank forwards the documents for collection to the buyer’s or importer’s bank. Upon receipt of payment, the Bank applies the proceeds against the outstanding financing obligation.
Key Features
- Provides liquidity through the negotiation or discounting of export bills, prior to receipt of payment from the buyer.
Benefits
- Supports business liquidity by providing working capital after shipment.
How to use the servicess
1.) The exporter submits a Request for Negotiation/Discount of Export Bills Drawn under L/C or a Collection Instruction for Negotiation/Discount of Export Bills, together with the required supporting documents.
2.) The Bank reviews the bills and supporting documents under the L/C or Bills for Collection (B/C) and, subject to approval, negotiates or discounts the export bills.
Supporting documents include:
2.1) L/C : Original L/C and any L/C Amendment(s) (if applicable); B/C : Original document of Bills for collections.
2.2) Commercial documents (e.g., Invoice, Packing List)
2.3) Transport documents (e.g., Bill of Lading (B/L), Air Waybill (AWB))
2.4) Bill of Exchange.
