Import documentary credit

An Import documentary credit (DC) is a commitment given by your (the buyer’s) bank, to the seller (exporter), that they will make payment upon presentation of a pre-agreed, specified set of documents.

Let HSBC Bank Armenia pay suppliers on your behalf, giving suppliers additional comfort that they will receive payment after presenting the correct documents and you the comfort that you can better manage cash flow and negotiate better trade terms with the suppliers without an increase in cost of the goods. DC utilization will provide you an opportunity to receive expert advice on handling shipping documents in accordance with international rules and regulations.

Please click here for reviewing general terms and conditions applicable to credit facilities.

At a glance

You do not want to make payment without evidence that your supplier has shipped goods and submitted documents specified by you.

Your supplier needs additional assurance of payment before shipping goods.

Your supplier wants payment assurance from world-class financial institution.

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Key benefits

  • One of the most popular methods for settling international trade transactions

     

    Documentary credits are one of the most popular methods for settling international trade transactions because they are honored throughout the banking system and offer security to both buyer and seller. The seller wants security of payment; the buyer wants an assurance that payment will be made only after dispatch of the specified goods.

  • Documentary credits can be tailored to your business needs

     

    Each documentary credit can be tailored to your requirements governing shipping, delivery, insurance and quality inspection.

  • Providing security for your supplier

     

    Since payment is guaranteed by HSBC Bank Armenia, trading on documentary credit terms provides security for your supplier giving you additional leverage to negotiate more favorable pricing and longer payment terms.

  • Opportunities to organize your import transactions efficiently

     

    While using import documentary credits you will have opportunities to finance your transactions efficiently through exercising deferred payment documentary credit options, where you will be able to pay after receipt of the goods, and short-term trade loans for buyers.

  • Expand your business in new markets

     

    Payment under import documentary credit will only be made if your supplier has complied with all the terms and conditions prescribed in the documentary credit. As a result, a documentary credit can help you expand your business and deal with new business partners in new markets.

  • Providing flexible financing opportunities for your exporter

     

    With import documentary credit the exporter’s bank can make payment to the supplier without having to draw down on supplier’s credit facilities or pledging security with the bank.

Documentary credits are handled in accordance with the rules published by the International Chamber of Commerce (ICC).

Last updated on: 22/11/19 18:47 UTC

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