Letter of Credit Confirmation

To mitigate payment and country risk on LC transactions

Letter of Credit Confirmation
  1. ①Your company (Supplier) enters into contract with Buyer and demands L/C terms with confirmation.
  2. ②Buyer requests L/C issuance to issuing bank with confirmation as condition.
  3. ③L/C issuing bank opens L/C with confirmation required.
  4. ④SMBC advises L/C with confirmation added.
  5. ⑤Supplier ships the goods (and receive Bills of Lading from shipping company).
  6. ⑥Supplier presents documents to SMBC
  7. ⑦SMBC forwards the documents to L/C issuing bank.
  8. ⑧The Buyer makes payments at maturity.
  9. ⑨Issuing bank pays to SMBC.
  10. ⑩SMBC pays to your company.
  • ・Additional assurance to your company for payment due from L/C issuing bank
  • ・Especially useful for L/C issued from banks with higher credit risk or from high risk country