How to Handle Letters of Credit

Overview

Course duration: 1 day.

This course will enable participants to understand the mechanics of handling letters of credit in simple terms from the exporter’s point of view.

Fifty percent of documents presented under letters of credit are rejected by the banks because of discrepancies. Participants learn what they can do, in practical terms, to improve letters of credit performance, and ensure good management and collection mechanisms.

Is it right for me?

Suitable for anyone who wants to learn about letters of credit or who wants to improve their skills.

What will I learn?

By the end of this course you will be able to:

• Distinguish the benefits of the main forms (Irrevocable and Confirmed) and know when to use them.
• Use a formula to help buyers improve the content of letters of credit opened in their favour.
• Check incoming letters of credit, using a reliable check list.
• Appreciate how bills of exchange work with letters of credit.

What will it cover?

Forms of Letters of Credit

• Learn the difference between Revocable, Irrevocable and Confirmed Irrevocable letters of credit
• How to choose the appropriate form 
• Identify the types of letter of credit  
• Learn when to use the different types

Understanding the Letters of Credit Process

• The parties involved
• The document flow 
• The costs involved 

Using Letters of Credit

• What are the advantages and disadvantages? 
• Understand the precise documentation demands
• Learn how to check an incoming Letter of Credit using a checklist
• How to help buyers improve the contents of Letters of Credit opened in the exporter's favour
• Presenting documents to the bank 
• Dealing with discrepancies
• Improving Letters of Credit performance

Bills of Exchange

• What are Bills of Exchange and who are the parties to them? 
• When and why would you use them?
• Negotiating Bills of Exchange
• Forfeiting procedures and avalised Bills of Exchange  
• Learn how Bills of Exchange work with Letters of Credit

UCP 500

• The Uniform Customs and Practice for Documentary Credits, publication 500 explained 
• The importance to the exporter
• The key points contained in UCP500 and how they support the exporter

Testimonial

Dhiren Shah, Treasury Operations Assistant

Itochu Europe PLC

Provided an informative and clear understanding of the mechanics involved with letters of credit from which I have benefited immensely, the knowledge I gained is now a source of information for others.