A letter of credit is a payment term generally used international seller’s transactions. It is basically a mechanism, which allows importers / buyers to offer secure terms of payment to exporters / sellers in which a bank (one or more than one bank) gets involved. A L/C is a letter from a bank guaranteeing that a buyer's timely and full payment to the seller. If the buyer is unable to make such a payment, the bank covers the full or the remaining amount on behalf of the buyer.
Due to the nature of international dealings, including factors such as distance, differing laws in each country and difficulty in knowing each party personally the use of letters of credit has become a very important aspect of international trade. Since the nature of international trade includes factors such as distance, different laws in each country and the lack of personal contact during international trade, letters of credit make a reliable payment mechanism.
Considering above, SFCS maintain liaison with various parties involved with L/C processing to provide smooth & functional L/C processing services for the importers / buyers by arrangement of L/C processing services.