Trade Finance Guy .com

Place to learn trade finance

  • What is red clause L/C?  the simplest thing to say is that  it is an advance payment L/C. Under Red Clause L/C, the issuing bank will make the advance payment  to the exporter / seller before they actually ship the goods to the importers. Issuing banks make the advance payment under a red clause letter […]

  • Back-to-back L/C serve almost simliar purpose as transferable L/C, which is to accomodate intermediary trade transaction. Whereby the middle man / trading house issue a L/C (Back to back L/C)  to their final supplier, using the LC that their received from the final buyer (master L/C) as the security to the issuing banks. If it […]

  • Transferable Letter of Credit ( Transferable L/C ) is one of the structured L/C that is commonly used in the international trade transaction. To make it simple, transferable L/C is basically L/C that can be transferred by the first beneficiary to the second beneficiary. For a L/C to be transferable, it will need to specifically […]

  • Uniform Rules for Collection No.522 (URR 522) is the most frequently used rule in documentary collection transaction.  URR was established by in June 1995,  it is issued with the title “ICC Uniform Rules for Collections” as ICC Publication No 522. This English language gives the official text of the 1995 Revision. The Uniform Rules for […]

Latest Articles

The easiest way to understand green clause L/C is to understand Red Clause L/C first, since the scheme is quite similar, the difference lays is that Green Clause L/C requires more documentation than Red Clause L/C. Unlike the red clause letter of credit, in the case of a green clause letter of credit, the advance is normally paid not only against receipt and a written undertaking from the seller to […]