Letter of Credit

What is a Letter of Credit?

A Letter of Credit is a conditional payment confirmation. The buyer’s bank promises to pay the invoiced amount to the seller’s bank, according to the rules described in the Letter of Credit.

Advantages for the buyer

• the products are sent before the seller receives payment;
• easier control of the date of the product’s arrival;
• easier access to credit or a price reduction;
• the bank will wholly or partly be able to finance the products;
• The entity providing the Letter of Credit for a product delivery often takes precedence when there is a shortage of stock

Advantages for the seller

• Security that the payment will be made
• Financing of the product while it’s en route
• Can disregard the buyer’s financial position.The order cannot be cancelled without consent
• Guaranteed by the bank that payment will be made on the agreed date

Would you like to order a Letter of Credit?

An application for a Letter of Credit undergoes the same credit assessment as an application for credit or a loan.

We are available from Monday to Friday between 08:00 and 16:00 Call us on +47 950 91708. If you have a client manager at DNB you can contact them directly.