Crédito documentario de exportación
It guarantees that if you comply with its terms and conditions
The issuing bank must address the payment
- Removes the risk of the buyer cancelling the contract. It allows you to offer your client financing. It brings peace of mind as the documents are checked by Bankia's experts.
Benefits of the Export Letter of Credit
The documentary letter of credit is the safest means of payment for an exporter, since it is a guarantee that if they comply with its terms and conditions and present the documentation in due time and in the correct form in the place stipulated in the documentary letter of credit, the issuing bank has the irrevocable commitment to address its payment on the agreed maturity (on presentation or deferred).
With the documentary letter of credit you have the possibility of adding the Bankia guarantee to the guarantee of the issuing bank, advising your client to ask their bank to issue their credit with confirmation instructions. After studying the risk of the operation, the credit quality of the issuing bank and the availability of its risk facilities, Bankia will decide whether or not to add its confirmation, notifying its decision urgently both to you and the issuing bank, in compliance with the obligations imposed on it by the UCP 600.
At the time of the notification of the credit, it is important that you revise all the terms and conditions to confirm that they are those agreed and that you are able to fulfil them. Your payment guarantee depends on the proper presentation of the documents required in the documentary letter of credit.. Always bear in mind that the documentary letter of credit pays documents, not merchandise.
If you would like to know more about this product, see this Export Documentary Letter of Credit Presentation (PDF, 3.7 MB)
As an exporter you should know that:
- For its character "irrevocable"' You eliminate the risk the buyer terminating the contract.
- It ensures that, if you present the agreed documents, you will receive your payment on the stipulated date, thus eliminating the business risk.
- It allows you to grant financing to your client, delaying the date of payment. Bankia can buy your right to receive payment in advance and without recourse (Forfaiting on Export Letters of Credit).
- It provides you with legal protection, since credits are regulated by a specific international regulation of the ICC (UCP600).
- It gives you peace of mind, as the documents are checked by Bankia's experts before being sent to help you avoid any discrepancies.
- If you confirm the credit, you eliminate the political or country risk.
- If you take out a Forex insurance, you eliminate the foreign exchange rate risk.