Export Letters of Credit

 

Reduce the risk of your overseas buyer’s non-payment or slow payment with a Letter of Credit (LC) from your buyer’s bank. The LC is the bank’s promise to pay you upon your submission of certain documents showing that you have shipped the goods. As Advising and Negotiating bank, Huntington acts as your conduit to the foreign bank and follows up to ensure you get paid quickly.

You may want to pass the risk to Huntington in the form of an LC Confirmation. In this case, we promise to pay you upon our receipt of the required documents regardless of whether the buyer and the bank are still able to pay.

Would you increase sales if you offered the buyer up to 180 days to pay? We can easily structure the LC so that the buyer receives payment terms, but you get a Bankers Acceptance: the bank’s unconditional obligation to pay you.

If you prefer, we will pay you now (less discount interest), then wait for the foreign bank to reimburse us. The discount rate may be less expensive than most other types of loans available, and it doesn’t affect your credit line, since we view it as a loan to the foreign bank.

How do Huntington Export Letters of Credit help your business?

  • Shift your risk from your buyer to your buyer’s bank.
  • Reduce your risk further with Huntington’s LC confirmation.
  • Safely extend terms to increase your sales with Bankers Acceptances.
  • Improve your cash flow by discounting the Bankers Acceptance with Huntington.
  • Reduce your financing expense while freeing up your credit line.
  • Rely on Huntington’s experienced people to help you craft detailed instructions for your buyer.

When should you consider Export Letters of Credit?

If any of the following is true, contact us for more information.

  • You don’t know the buyer or you are uncomfortable extending credit to them.
  • Your buyer is in a risky country.
  • Your buyer wants time to pay, but you want your money upon shipment.
  • You are selling to a country where LCs are customary.

To learn more about Export Letters of Credit, contact your Banker or International Specialist. You can also call International Direct at 1-877-480-INTL (4685) Monday to Friday, 8:00 a.m. to 5:00 p.m., ET. Or email us at International@huntington.com.