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Letter of Credit

Bank-backed payment security for international B2B transactions

What is L/C

A Letter of Credit (L/C) is a bank-issued guarantee that payment will be made to the seller once specified conditions are met—typically upon presentation of compliant shipping and trade documents. L/C is widely used in international B2B trade to reduce payment risk for both buyers and sellers, especially for high-value or first-time transactions.

7CENTER integrates L/C financing into the platform, allowing buyers to apply for and use L/C with verified suppliers while streamlining document handling and compliance.

Benefits for Buyers & Sellers

Buyers

Payment assurance—funds are only released after goods are shipped and documents comply. Deferred payment options (usance L/C) improve cash flow.

Sellers

Bank guarantee of payment upon compliant documentation. Reduced risk of non-payment and easier access to trade finance.

Both Parties

Clear, internationally recognized process. Documents checked against terms; disputes resolved through established banking rules (UCP 600).

How L/C Works on 7CENTER

1
Buyer applies for L/C through 7CENTER, specifying terms (amount, validity, shipping, documents required).
2
Issuing bank sends the L/C to the advising/confirming bank and notifies the seller.
3
Seller ships goods and prepares documents (bill of lading, invoice, packing list, certificates, etc.).
4
Documents are submitted to the bank for examination against L/C terms.
5
Payment is released to the seller upon compliance, or the buyer is notified of discrepancies for resolution.

Types of L/C

  • Sight L/C: Payment is made upon presentation of compliant documents (immediate payment).
  • Usance L/C: Payment is deferred to an agreed future date (e.g., 30, 60, 90 days after presentation or shipment).
  • Standby L/C: Acts as a guarantee; drawn only if the buyer fails to fulfill obligations.
  • Revolving L/C: Automatically renews for multiple shipments within a defined period and limit.
  • Transferable L/C: Allows the beneficiary to transfer all or part of the L/C to a second beneficiary (e.g., a sub-supplier).

Requirements & Documentation

  • Commercial invoice
  • Bill of lading or transport document
  • Packing list
  • Certificate of origin
  • Inspection certificate (if required)
  • Insurance certificate (if required)
  • Any other documents specified in the L/C

Trade Services

Apply for L/C financing

Connect with our banking partners and use L/C for secure, high-value transactions.

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