Letter of Credit Benefits
What are the benefits of securing a letter of credit from Express Trade Capital?
For your company (the buyer)
- You may not have the necessary collateral requirements or relationship with the bank to get a letter of credit—but we do.
- You don’t have to leave deposits with your suppliers, since your letter of credit will be opened for the full amount of the transaction—so your cash is not tied up or at risk while your supplier can often borrow against a letter of credit.
- You may significantly increase your ability to do business with companies outside the U.S. by bolstering your financial position with your suppliers.
- You can build safeguards into the letter of credit, including inspection of the goods and quality control, and set production and delivery times. This gives you more quality control over your goods.
The bottom line
A letter of credit minimizes risk, maximizes control, and optimizes profits associated with international trade by making transactions simpler, smoother and safer for all sides.
Ready to get started? Complete our letter of credit application:
For the beneficiary (the seller)
- Payment is assured as long as you comply with the terms and conditions of the letter of credit.
- The credit risk is transferred from the buyer to the issuing bank, which is obligated to pay even if the buyer goes bankrupt.
- You have easier access to financing and are able to transfer all or part of the letter of credit to another party, e.g., to purchase raw materials.
- Collection time is minimized, as the letter of credit accelerates payment of receivables, and foreign exchange risk is eliminated when it is issued in the currency of your country.