A Documentary Letter of Credit (L/C) is a conditional undertaking of payment for goods or services. It is a written undertaking by an issuing bank given to the Seller (Beneficiary) at the request and on the instructions of the Buyer (Applicant) to pay at sight or at a specified future dated a defined amount against presentation of stipulated documents.
A Documentary Letter of Credit is the safest payment instrument, which gives maximum protection both to the buyer and the seller.
If you are a BUYER / IMPORTER , an L/C can protect your interests because the payment of an agreed amount of money will be made only if the seller (exporter) presents documents in compliance with the terms and conditions of the L/C to prove that the goods or services of an agreed quality have been delivered/provided in the agreed quantity within an agreed period of time.
In order to open an irrevocable documentary letter of credit, it is necessary to:
- submit an application for opening a documentary L/C (use the following links to download the Application: Order to open a documentary letter of credit with filling-in instructions , attachment to Application )
- provide sufficient funds for opening of a documentary L/C .
If you need to open an L/C without providing funds prior to the due payment under a Documentary L/C , it is necessary to conclude a separate contract with the Bank.
If you are a SELLER / EXPORTER , an L/C can secure the collection of payment, provided that you deliver goods or provide services and submit to the Bank all the relevant documents in compliance with the terms and conditions of the L/C. A deferred payment L/C provides both an insurance for payment for your exported goods and a perfect trade finance instrument.
Privredna banka Zagreb d.d. is ready to negotiate purchase of the proceeds under a deferred payment L/C before the maturity date through export forfaiting.
CONTACT
For further information please visit CONTACTS, contact your Relationship Manager for Corporate Banking (Large Companies and Banks) or call our toll-free info number 0800 PBZ COM (0800 729 266).