- Home
- Bankruptcy and Bankruptcy Code
- Business Entities
- Departmental Operations
- Credit Practices
- Collection Practices
- Financial Analysis
- Financing Methods
- International Credit
- Customs Regulations
- Exporting and Importing
- Financing International Sales
- International Banking
- Letters of Credit
- Amendment to a Letter of Credit
- Assignment of Proceeds of a Letter of Credit
- Commercial vs Standby Letter of Credit
- Engagement Clauses in Letters of Credit
- Installment Letters of Credit
- Letters of Credit
- Discrepancies in Letters of Credit
- Revolving Letters of Credit
- Standby Letter of Credit, Irrevocable Standby Letter of Credit
- Letter of Credit Fraud
- Letter of Credit Risks to the Seller
- The Three Cs of International Credit
- Denied Parties; Export Administration Regulations
- Letter of Credit Discrepancies
- Ex-Im Bank
- Export Credit vs International Credit
- Letter of Credit Instructions
- Credit Insurance; and the Foreign Credit Insurance Association
- The Foreign Corrupt Practices Act
- The Growth of International Credit
- Credit Insurance; Trade Credit Insurance; Credit Risk Insurance; International Credit Insurance
- Export Credit Risk; International Commercial Risk, Export Trade Credit Risk
- Forfeiting; International Financing
- International Credit Policy; Open Account vs. Letter of Credit
- Foreign Financial Statement Analysis; IASB; International Accounting Standards Board
- Marine Cargo Insurance; Cargo Insurance; Ocean Marine Insurance
- International Payment Terms; Methods of Payment for International Sales
- Political Risk Insurance; Export Credit Insurance
- Silent Confirmation
- Sovereign Risk; Political Risk; Country Risk
- Uniform Customs and Practice for Documentary Credits; UCP 600
- Gathering Information about Foreign Credit Applicants
- International Open Account Terms
- Common Reasons for International Customer Payment Default
- Analyzing Foreign Financial Statements
- Laws and Regulations
- Payment Methods
- Performance Measures
- Security Instruments
- Career Management, and Job Change
- Credit Website Tools
- Upcoming Educational Events
- Credit and Collections Tools and Tips
- Tips on Creating Better Emails
- Generating Effective Credit Correspondence
- Exporting
- Accounting
Installment Letters of Credit
The buyer / applicant for a Letter of Credit may want assurance of receiving the merchandise over a period of time in certain installments. When a bank issues an installment L/C or a credit stipulating shipments by installment within given periods, that credit should clearly state:
"Shipments must be effected in the following installments."
For example, the bank should not leave it up to the beneficiary to determine whether a clause, "Ship Style No. 1 no earlier than January 1, and no later than January 31; Ship Style No. 2 no earlier than February 1 and no later than February 28; and Ship Style No. 3 no earlier than March 1 and no later than March 31," is to be interpreted as an installment requirement.
Sellers and buyers should be aware that failure to meet the condition(s) of any installment causes the Letter of Credit to be null and void for future drawings.
Edited by Michael Zininberg & Michael Dennis. Mr. Zininberg is a credit professional with experience monitoring, managing and collecting from customers worldwide. He can be reached by email at mzininberg@gmail.com