Letter of credit

What is the letter of credit? 

Letter of Credit represents a commitment of a bank to pay the seller of goods or services a certain amount of money provided he presents stipulated documents evidencing the shipment of goods or the performance of services within agreed period of time.

Thus, if the submitted documents correspond to the requirements of the letter of credit, payment of for the dispatched goods/rendered services is possible without the consent of the buyer.

JSC Bank VTB (Georgia) opens all the types of the irrevocable documentary letterof credits(standby, revolving, back-to-back, red clause, transferable)depending on the types of payment (direct payment; installment payment; acceptance; negotiation)in favor of the beneficiaries of the countries which are not covered by the international commonwealth sanctions. 

The letters of credit of the same types are opened in favor of the resident beneficiaries.

JSC VTB Bank (Georgia) for exporters

  • LC’s authentication and advising 
  • LC’s transfer
  • Consulting works related to LC documents complying presentation 
  • Confirmation of LC’s issued by foreign correspondent banks
  • Taking up of LC documents and presenting to nominated banks
  • Export LC’s confirmation and improved liquidity as payment often can be made shortly after shipment 
  • For export financing Packing Loan’s arranging possibility

JSC VTB Bank (Georgia) for importers

  • Consultancies before the contract signing 
  • Issuing of the letter of credits of all the types 
  • First rate banks confirmed LC’s 
  • Financing and discounting of the deferred payments
  • Checking the compliance of the submitted documents 
  • Payment of the amount of the letter of credit, etc. 

Financing related to the foreign trade

International trade financing— is one of the prioritized directions of JSC Bank VTB (Georgia)’s activities.

JSC Bank VTB (Georgia) offers to its clientsissuance of all the types of the uncovered letter of credits without the preliminary reserving of the client’s own funds, within the credit lines established in the name of customers.Payment schedule for the goods supplied is fixed in advance, taking into account customers cash-flow. Thus, the client may purchase goods, apply them into the entrepreneurial cycle, and pay the price afterwards.

Structuring with this type is quite profitable for the client as besides the fact that the client is able without freezing of the own monetary funds purchase goods, full cycle of the operation is financed by foreign and cheaper finances, and that significantly reduces the total transaction cost.

Terms and conditions:

Import letter of credit 
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Issuing of the letter of credit0.3% (min.120 USD)
Confirmation/servicing of the letter of creditBy negotiation
Amendment 120 USD
Cancellation of the letter of credit100 USD
Transfer of the part of the letter of credit0.4% (min. 120 USD)
Taking up of documents and payment0.2% (min. 120 USD)
Issuing and serving of the letter of credit in national currency          By negotiation
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Export of the letter of credit
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Advising of the letter of credit0.2% (min. 120 USD)
Confirmation commissionBy negotiation
Amendment120 USD
Cancellation of the letter of credit100 USD
Transfer of the letter of credit or its part0.4% (min. 120 USD)
taking up of documents and payment0.2% (min. 120 USD)
Advising of the letter of credits issued by other banks50 USD
1
Additional expenses
1
Postage and communicationBy fact
Pre-advising100 USD
Other additional expensesBy fact