Tag Archives: Trade Finance
Trade finance may come in the form of secured or unsecured loans or lines of credit from banks or financial institutions. Pre-shipment financing is especially important to smaller enterprises because the international sales cycle is longer than the domestic sales cycle.
The fundamental purpose of a Letter of credit is to provide transaction payment security to the beneficiary and documentary performance to the applicant and hence all LCs are fundamentally similar. There are however a few categories of LCs which do have a customized usage.