Features of letter of credit settlements in international practice

the article reveals international settlements on a letter of credit, their features, highlights the advantages and disadvantages of this operation. The author analyzes the concept of a letter of credit in detail, referring to the legislation, the opinions of scientists, and reveals the legal basis of this form of settlement. The features of settlements by means of a letter of credit are listed, practical examples are given, and the opinions of scientists are analyzed. It is concluded that a letter of credit is the instrument that makes any transaction secure. This is an exceptional bank account in which capital is frozen until all the rules of the transaction are fulfilled. Such accounts are used in the case of work, sale of goods. The supplier and the buyer form the conclusion of the contract, which reveals the essence necessary to open a letter of credit. To make the conclusion of transactions a priority, you can apply a letter of credit. Through this method of settlement, the seller and the buyer receive protection from risks, since the bank acts as a guarantor. Letters of credit are especially common when performing foreign trade activities. This is a priority means of payment. Letter of credit forms of payments make it possible to work with foreign partners. In the absence of data on the wealth of an international partner, you can work. A letter of credit also performs the function of a loan. Some of the letter of credit forms may delay payment for the product that has been shipped. The prospect of changing the payment rules for a letter of credit gives exporters the right to set the right prices and increase sales. Importers may not take the money from circulation that they need. The settlement relations under the letter of credit in international practice are being systematically improved. This follows the actions that take place in the world.

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