When your business is grown to the point to be able to export goods or import supplies from others you need to be introduced to a useful tool: the Standby letter of credit, also known as SBLC. The standby letter of credit or SBLC is the irrevocable commitment of the bank to compensate the beneficiary in the event of default of payment of the debtor. SBLC are designed according to what the International Stand-By Rules And Practices or ISP98 establish. The SBLC is a bank guarantee that it is used by exporters to secure the execution of a contract. It is easy to implement and manage and it is an adapted guarantee that can be used for transactions or specific operations with commercial partners that are known and frequent.
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Characteristics of Standby Letters of Credit
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