Table of Contents
What is the Commission on SBLC?
What are the fees for Standby Letters of Credit? It is standard for a fee to be between 1-10\% of the SBLC value. In the event that the business meets the contractual obligations prior to the due date, it is possible for an SBLC to be ended with no further charges.
Can we discount SBLC?
Can SBLC be discounted? Yes, an SBLC can be discounted and is often considered a great investment instrument.
How do I cancel a Standby Letter of Credit?
In order to cancel a letter of credit, an issuing bank has to receive a written declaration from the beneficiary certifying that the letter of credit will not be utilized.
What is the cost of SBLC?
After review of the documentation, the commercial bank will provide an SBLC to the buyer. The bank will charge a service fee of 1\% to 10\% for each year when the financial instrument remains valid. If the buyer meets its obligations in the contract before the due date, the bank will terminate the SBLC without a further charge to the buyer.
How do I lease an SBLC?
Lease An SBLC- You can apply to lease an SBLC in one of two ways. One way is to apply for a StandBy Letter Of Credit with your bank or; use authorized agents such as ourselves and fill in a DOA (deed of Agreement). Some terms and timelines may be negotiated (there may be an element of flexibility through some Providers).
When do I return the leased standby letter of credit (SBLC)?
Important: In our contracts, the purchaser must return the Leased Standby Letter of Credit (SBLC) to the Issuing institution 15 days before the year anniversary of the contract.
What is a contractual SBLC / SLOC?
A Standby Letter of Credit (SBLC / SLOC) is a guarantee that is made by a bank on behalf of a client, which ensures payment will be made even if their client cannot fulfill the payment. It is a payment of last resort from the bank, and ideally, is never meant to be used. How can a contractual SBLC be used and how does it work?