Requesting A Letter Of Credit

• Once you have sent a pro forma invoice or an order acknowledgement to your buyer, you should request a letter of credit.
  • Details on what such a request should contain are available from banks that handle letters of credit.

• Here is a list of items that you should ask your buyer to provide when preparing a letter of credit.
  • That the letter of credit be confirmed, irrevocable, and at sight.
  • Suggest a Paying Bank that is convenient to you.
  • Quantity of items being shipped.
  • Value of items being shipped.
  • Specify the currency.
  • Specify the latest shipping and expiration date.
  • Specify the appropriate Incoterm.
  • State whether partial shipments are allowed.
  • Specify which documents that are required for payment.

• It is best to provide the buyer with a sample form for requesting a letter of credit.

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© 2004 John Michael Pierobon

Notes