Managing Risk
Help protect against the impact of exchange rate fluctuations and the risk of not being paid
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Managing Risk
Letters of Credit
Why use a Letter of credit?
Secure method of settlement
Reduce the risk of non- payment for delivered goods
Once Issued are legally binding
Irrevocable and cannot be cancelled unless all parties agree
Letters of credit in detail...
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Expand into new markets
Export letters of credit could enable you to trade in markets where other types of payment could be risky.
Payment security
Ship goods in the knowledge that, providing your documentation is in order, you'll receive immediate payment or an agreement to pay in the future from us or the buyer’s bank.
Secure finance
Letters of credit could increase your chances of securing pre-shipping finance.
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Import Letters of Credit
Import letters of credit reassure your overseas suppliers about receiving payment and they assure you about the receipt of your goods from overseas before you pay. This gives you confidence that the goods you buy will be as ordered, and they will be delivered at the agreed time and place.
Export Letters of Credit
Export letters of credit are payment commitments given by your buyer’s bank providing that you fulfil the terms and provide the documentation as required within the letter of credit.
Guarantee payments
When exporting to developing countries – we may consider ‘confirming’ the letter of credit. This means that, subject to the terms of the letter of credit being met and all documents being in order, we'll guarantee payment in the event that the buyer’s bank is unable to.
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Export Letters of Credit factsheet
Our Export Letter of Credit enables you to trade goods safe in the knowledge that you will receive payment. This is because Export Letters of Credit provide a commitment given by the buyer’s bank that they will pay on behalf of their client, provided certain pre-agreed conditions are met. This product is sometimes called a Documentary Credit.
Ready to apply
Great, thanks for choosing Letters of Credit. If your Relationship Manager has confirmed you have a credit line in place to support this facility, apply online with our simple application form below.
Alternatively, you can always talk to your relationship manager. If you’re a new customer with an annual turnover of less than £2 million, you can give us a call on 0345 050 0519. If it’s over £2 million, call us on 0345 050 0692.
Customers with hearing and speech impairments can contact us by using our Relay UK Service: 18001 0345 050 0519 if your annual turnover is less than £2 million or 18001 0345 050 0692 if your annual turnover is more than £2 million.
For more information on accessibility visit: https://www.business.rbs.co.uk/business/accessibility.html
Calls may be recorded for training and monitoring purposes.
To see how much your call might cost, visit the call charge information page.
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