Letter of Credit Process


To avail Letter of Credit from Bronze Wing Trading L.L.C., the LC Provider in Dubai, please follow Letter of Credit Process given below:-

 1. The buyer presents their trade deal by submitting a buy and sell agreement or a proforma invoice.

 2. Secondly, BWT will do an analysis of the trade deal between the buyer and seller. And will also, informs the party, if their request is approved or not. 

 3. And, if approved, we will send the service agreement to the client. Also, we will inform them about the admin charges to initiate their transaction.


 4. Once they sign the service agreement and pay the admin charges, we will start working on their DLC transaction. Further, we will send the DLC MT700 draft to the buyer for their review.

 5. Finally, upon receipt of DLC MT700 draft approval and the DLC issuance fee, we will open the required Letters of Credit from our European Bank account via swift MT700 in favor of the seller. Certainly, it will not take more than 2 banking days to complete the transaction.
Letter of Credit Process – How to Open Letter of Credit

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    Irrevocable Letter of Credit


    Latest Transaction


    LC at Sight Issued to Facilitate Rice Import

    A South-African Buyer has an import requirement for 10,000 MT of IR 64 Rice. To facilitate their rice import deal with a supplier in Pakistan, we issued an LC at Sight from one of our best banks in Europe at ZERO Collateral or Cash Margin! With the issued DLC at Sight, the deal between the buyer and the supplier concluded successfully!

    Amount: USD 350,000
    Instrument: DLC at Sight
    Validity: 90 Days from Issuance


    Looking for a FREE Quote to Open LC MT700?


    What is LC Payment Term?


    LC Payment Terms is one of the safest and popular payment methods available for buyers. Further, this assures the seller that they will receive their payment in a specified currency within a set time period; only if, the seller submits the shipping documents to the bank as stated in the issued LC.

    So, what is LC Payment? It is also called as LC at Sight & Letter of Credit. It’s a written undertaking issued by banks on behalf of the buyer & in favor of the seller to give assurance in terms of payment & shipment. Since it works 100% to secure global trade, this acts as the vital payment method for global trade. Further, this DLC is governed by the International Chamber of Commerce’s latest version of UCP 600.

    The buyer provides the DLC in favor of the seller; in which the bank takes an irrevocable undertaking that the payment will be made to the seller against the submission of documents that comply with the LC terms. And this includes by all means – quality, quantity, & shipping.

    The Document required for submission includes Invoice, Packing List, Ocean Bill of Lading or Air way Bill and the Certificate of Origin of the goods. Once the seller submits these documents to the bank, the bank will verify them & process the payment. This is how DLC helps both buyers & sellers secure their trade transactions.

    Letter Of Credit

    Why Importers and Exporters Would Opt for DLC Payment Term?

    Using MT700 gives assurance to the buyer that they will receive the goods as per the agreed contract. And it assures the supplier that the payment will be made for the supplied goods. Also, it gives more advantage to the seller that they may receive a credit line or packing credit against the issued DLC to mobile their exports. Below are few reasons why Importers / Buyers prefer to use DLC as their Payment term.

    For Importers / Buyers:

    • If the buyer uses the Letters of Credit as a financial instrument. Then they can structure the payment plan with the consent of the seller.
    • It acts as a surety. Therefore, this assures that the payment will be made upon the submission of documents agreed in the issued MT700 T&Cs.
    • It allows the buyer to purchase goods without making advance payment towards the seller.
    • Assures the buyer that the supplier will meet all the terms of the issued MT700.

    For Exporters / Suppliers:

    • Payments are assured, once all the documents are submitted as stated in the issued LC T&Cs.
    • It reduces the risk in situations when a buyer changes or revokes their order.
    • The buyer cannot deny the payment or reject the products, due to any issues regarding the goods. But they can raise the complaint(s) about the goods delivered.
    • The supplier can re-structure the delivery schedule as per their ease.
    • With the LC, the supplier may also receive a credit line or packing credit to mobilize their exports.


    Open DLC at Sight at ZERO Collateral


    Parties Involved in LC

    • Applicant – The applicant is the buyer who contacts their bank to issue the LC for the purchase of goods or services from the seller.
    • Beneficiary – The supplier who receives the LC; also, whose favor the LC is issued.
    • Issuing Bank – The institution that issues the LC on behalf of the buyer & in favor of their seller.
    • Advising Bank – The one who sends the DLC to a bank with whom they have a relationship, to advise the same towards the seller.
    • Supplier’s Bank – The seller’s bank, where the DLC will be finally sent.

    Steps We Follow in the Letter of Credit Process

    • Buyer and supplier sign the proforma invoice or sales agreement. This includes the details of goods, product description, delivery time. And also, the price under FOB / CIF / CF with the payment time period.
    • Further, the buyer contacts BWT, the LC Provider in Dubai for the issuance of MT700.
    • Meanwhile, we will analyze the trade deal and let them know whether it’s approved or not. If approved, we will proceed with the next process.
    • On behalf of the buyer, the LC provider in Dubai will issue the MT700 either directly to the supplier. Or else, through the Advising bank to further advise the MT700 to the supplier via Swift MT700.
    • And now, the supplier analyzes the received Letters of Credit and check whether it complies with the signed proforma invoice terms.
    • If so, then the supplier arranges the goods for the shipment. Upon shipment, when they receive the Bill of Lading, they prepare other documents as per the T&Cs. After that, they submit these documents to their bank to claim the payment.
    • And then, the Supplier’s bank will verify the documents. Further, if it complies with all the terms, they will forward the documents to the advising bank to claim the payment.
    • Moreover, the issuing bank will check the documents thoroughly. Once it complies with the terms, they will debit the buyer’s account. Also, transfer the payment to the supplier against their bill of exchange.
    • Meanwhile, they will release the original shipping documents to the buyer to get the delivery of goods from the port.

    With a simple process, MT700 gives the assurance that the suppliers will get paid.  Apply for Letters of Credit onlineApply for Letters of Credit online & start importing goods from overseas!


    Import Goods Without Paying Your Supplier in Advance,


    Types of LC

    Irrevocable LC

    Once issued, letters of credit cannot revoke or cancel by the issuing bank.

    Transferable LC

    This type of Letters of Credit issued, when the party is not the end supplier. That means the DLC beneficiary is just a middle party in the actual deal. But, they have a right to request their bank to transfer, in favor of the principal supplier. Also, once the DLC is transferred to the second beneficiary; it cannot transfer again to any other 3rd party.

    Confirmed LC

    Confirmed LC means the supplier needs confirmation from another bank, once the issuer has a low rating. Further, this acts as an additional assurance to honor the compliance of the payment.

    Unconfirmed LC

    Typically, this type of Letters of Credit does not need other bank’s confirmation.

    LC at Sight

    It is a payment term that covers the payment instantly by the issuer, against the Bill of Exchange. Certainly, they review all the documents and pays the supplier once all the terms have complied.

    Usance LC

    In the Usance LC payment, the buyer is allowed to pay the proceeds of the supplied goods at the agreed time.  Further, all the documents should comply with the LC Payment Terms. And then, the buyer’s bank will issue a maturity date confirmation to the supplier’s bank to effect the payment.

    Back to Back LC

    Furthermore, middle companies are receiving Letters of Credit from their buyers and need to open a new LC towards their suppliers. Further, this is to arrange for the supply of products to their clients. Further, for this, the bank opens the Letters of Credit in favor of the principal supplier, against the MT700 received at their bank from their Ex buyer.

    Letter of Credit Cost

    Letters of Credit cost mainly includes issuance fees, negotiation fees, and swift charges. Also, these fees are borne by the buyer; or as per the agreed terms between buyer & supplier. Further, this has to be stated in the issued MT700.

    We are a letter of credit provider from Rated European Banks. Moreover, we act on behalf of buyers who don’t have enough funds to open the LC, to import their required goods.

    Submit your requirements today and get the LC issued in 48hrs!


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