So far, I have published two articles under "Letter of Credit Basics" series at advancedontrade.com.
First article was published with the following title: "Letter of Credit Basics: Definition and Types". Second article's title was "Letter of Credit Basics: Parties to Letters of Credit".
This is the 3rd article of "Letter of Credit Basics" series and it will be focused on letter of credit transaction process.
With the help of an illustration and detailed explanations, letter of credit transaction will be covered from beginning to end.
After reading this article, you should be able to answer questions such as:
- Who is initiating the letter of credit issuance process? Importer or exporter?
- Which party advices the credit to the exporter?
- Which party / parties must pay letter of credit amount to the beneficiary against a complying presentation?