Discounting LCs

The forum is dedicated to all who deals with LCs. Please share your experiences, problems and opinions with us. You are requested to be confined to LC related issues only. Let us together discover the beauty of Letter of Credit. Thank and regards – admin; besttradesolution.com
Post Reply
ameetsimha
Posts: 1
Joined: Mon Feb 26, 2018 10:22 am
First Name: A V
Last Name: Sim
Organization: mmmmm
Filter: Two Plus Two =: 4
Location: Dubai

Discounting LCs

by ameetsimha » Mon Feb 26, 2018 10:28 am

LC issued by Bank A. Documents presented by Bank B and accepted by bank A with 90 days usance. Can Bank C discount this LC. If yes how and what changes will be needed under the LC.

Megaman
Posts: 1
Joined: Tue Mar 13, 2018 4:54 pm
First Name: Ahmed
Last Name: Adel
Organization: Barclays Bank
Filter: Two Plus Two =: 4
Location: Egypt

Re: Discounting LCs

by Megaman » Tue Mar 13, 2018 6:50 pm

Hi there, i have similar case - do you received any reply regarding your inquiry
if not - what is the decision taken ?

User avatar
picant
Posts: 1580
Joined: Wed Aug 20, 2008 1:49 pm

Re: Discounting LCs

by picant » Wed Mar 14, 2018 11:03 am

Hi Pal,

probably discounting of a deferred payment l/c is regulated by Country Law. The bank A must be instructed by bank B to effect payment to bank C and inform the latter about this irrevocable instruction. It would be easier by presenting a draft. However IMHO it is locally regulated.
Other comments appreciated
Ciao

snejiblajeva
Posts: 5
Joined: Fri Jan 20, 2017 1:38 pm
First Name: Snezhina
Last Name: Blazheva
Organization: Pupil's net
Filter: Two Plus Two =: 4
Location: Bulgaria

Re: Discounting LCs

by snejiblajeva » Mon Mar 26, 2018 2:09 pm

It is possible Bank C discounts, first it has to receive confirmation for payment on due date from Bank A with MT7xx
Then Bank C signs contract with the beneficiary through the intermediary of his bank (may be Bank B) and the beneficiary pays discounting fee.
For example the presented documents are for 10 KEUR, comm for Bank C is 900 EUR
Bank C transfers to beneficiary 9 100 EUR and awaits from paying Bank on due date 10 KEUR.

zafarameer
Posts: 1
Joined: Sun Apr 01, 2018 1:50 am
First Name: Zafar
Last Name: Ameer
Organization: Stanmore Gnrl Trd
Filter: Two Plus Two =: 4
Location: UAE

LC Discounting MT 700

by zafarameer » Sun Apr 01, 2018 2:00 am

Hi All (i am new in this forum)

I have one question, my buyer said i am going to issue LC at sight MT700 through any one of top 10 banks with 120 days. My question is that i want to discount this LC minimum 60% to 75% is it possible? if yes then what i have to ask my buyer regarding the LC.

Thanks and Regards
ZAFAR

Post Reply