Letters of credit

• When you, either in the role of buyer or seller, have just established a contractual relationship with your partner and do not have sufficient information regarding his business and/or payment capabilities;     
• When one or both parties operate in countries characterized by high economic or political risk factors;     
• The legislation and commercial practice of the beneficiary country requires the use of letters of credit, etc.

NLB Banka issues Letters of Credit based on the General Rules and Practices for Documentary Letters (UCP 600) of the International Chamber of Commerce, Paris, France.

Letter of Credit is a written obligation, which our bank undertakes, on behalf of its customers (applicant/orderer), to make payment to the exporter (beneficiary) within a certain period of time, provided that the exporter I submit documents to the bank that are in accordance with the terms and conditions set forth in the Letter of Credit.

With letters of credit, if you are in the role of importer, you have several advantages:

• The bank can advise you on the type of appropriate documents that you can request through the letter of credit, which can insure you against the possible risk related to the non-fulfillment of obligations by the Exporter/Seller;     
• You can insist on sending the goods within a reasonable period of time, determining the last date for sending the goods and for presenting the documents;     
• Payment will be made to the exporter only if the documents are presented in accordance with the terms of the Letter of Credit;     
• With a Letter of Credit you can get a better price under a commercial contract than with any other less secure instrument;     
• You can pay in arrears, etc. 

We issue the following types of importing Letters of Credit:

• Confirmed;     
• Unconfirmed;     
• Transferable;     
• Revolving;     
• Standby.

NLB Bank also plays the role of advising bank (Advising Bank) for Export Documentary Letters of Credit issued in your favor by any other bank, or even as the confirming bank of these Letters of Credit. 

With letter of credit, if you are in the role of exporter, you have several advantages: 

• The payment will be made by the issuing or confirming bank if you present the documents in accordance with the terms required by the Letter of Credit, which means that the acceptance of the payment does not depend on the desire or ability to pay of the Borrower/Buyer;     
• You can specify the condition that the payment is made upon receipt of the documents;     
• The letter of credit cannot be canceled or changed without your consent.