HAB eBanking

Import Letter of Credit

HAB has been issuing Import Letters of Credit for over three decades and has established itself as one of the premier providers of trade services.

What is an Import Letter of Credit? It is a method of payment commonly used in international trade transactions, whereby the issuing bank promises to pay the exporter – provided the exporter complies with the terms and conditions of the letter of credit.  A letter of credit may also be referred to as a documentary credit.

Features

  • Irrevocable letters of credit cannot be cancelled or changed without the consent of all parties involved (importer, exporter and the issuing bank)
  • May be payable upon presentation of certain documents (sight) or at a future date after documents have been accepted under the letter of credit (term or usance)
  • The letter of credit should be consistent with the terms and conditions stipulated in the commercial contract
  • Maybe transferred to a third party if stipulated in the letter of credit
  • Import letter of credit applications may be completed and forwarded electronically via HAB Bank Trade to HAB Bank for processing
  • Importer is assured that, for the exporter to be paid, all terms and conditions of the letter of credit must be met
  • Importer may be able to negotiate more favorable trade terms with the exporter when payment by letter of credit is offered
  • Templates can be created on HAB Bank Trade to allow for efficient issuance of letters of credit to repeat suppliers.