King Washington Irrevocable Letter of Credit

• Category: Loans and Lending - Credit
• State: Multi-State
• County: King
• Control #: US-0192-WG
• Format: Word

Description

Irrevocable Letter of Credit A King Washington Irrevocable Letter of Credit (KWL/C), sometimes referred to as a King Washington ILC, is a financial instrument used in international trade and commerce. It provides a guarantee from King Washington, a financial institution, on behalf of its client (the applicant) to the beneficiary (usually a seller or exporter) that a certain amount of money will be paid on a specified date, upon the presentation of compliant documents. Keywords: King Washington, Irrevocable Letter of Credit, financial instrument, international trade, commerce, guarantee, applicant, beneficiary, exporter, specified date, documents. There are several types of King Washington Irrevocable Letter of Credit commonly used in international transactions: 1. Revolving Letter of Credit: This type of KWL/C allows the applicant to make multiple draw downs within a specified period. Once the credit is utilized, it gets reinstated for further use, thereby providing flexibility to the applicant for ongoing trade activities. 2. Standby Letter of Credit: A King Washington Standby Letter of Credit serves as a backup or security for the beneficiary. It guarantees payment in case the applicant fails to fulfill its obligations, such as making payment or performing a contractual duty. It is often used in situations involving non-performance or financial default. 3. Back-to-Back Letter of Credit: This type of KWL/C involves two separate letters of credit. King Washington, as the issuing bank, issues the primary letter of credit based on the applicant's creditworthiness. The beneficiary then uses this letter of credit as collateral to secure a second letter of credit from another bank, known as the confirming bank. This technique enables intermediaries to facilitate trade between two parties. 4. Transferable Letter of Credit: In a transferable KWL/C, the beneficiary can transfer all or a portion of the credit to one or more secondary beneficiaries. This allows for the division of the payment obligation and allows intermediaries to facilitate multi-party transactions. 5. Deferred Payment Letter of Credit: Also known as a since letter of credit, this type of KWL/C allows the beneficiary to receive payment on a deferred basis. The payment is typically made at a predetermined future date after the presentation of documents complying with the terms and conditions of the credit. 6. Red Clause (Advancing) Letter of Credit: A red-clause KWL/C permits the beneficiary to receive partial payment in advance of the actual shipment of goods. This advance payment assists the exporter in meeting initial costs and expenses related to the preparation and shipment of the goods. It is important to note that the terms and conditions of each type of King Washington Irrevocable Letter of Credit may vary, depending on the specific requirements of the trade transaction and the negotiation between the parties involved.

A King Washington Irrevocable Letter of Credit (KWL/C), sometimes referred to as a King Washington ILC, is a financial instrument used in international trade and commerce. It provides a guarantee from King Washington, a financial institution, on behalf of its client (the applicant) to the beneficiary (usually a seller or exporter) that a certain amount of money will be paid on a specified date, upon the presentation of compliant documents. Keywords: King Washington, Irrevocable Letter of Credit, financial instrument, international trade, commerce, guarantee, applicant, beneficiary, exporter, specified date, documents. There are several types of King Washington Irrevocable Letter of Credit commonly used in international transactions: 1. Revolving Letter of Credit: This type of KWL/C allows the applicant to make multiple draw downs within a specified period. Once the credit is utilized, it gets reinstated for further use, thereby providing flexibility to the applicant for ongoing trade activities. 2. Standby Letter of Credit: A King Washington Standby Letter of Credit serves as a backup or security for the beneficiary. It guarantees payment in case the applicant fails to fulfill its obligations, such as making payment or performing a contractual duty. It is often used in situations involving non-performance or financial default. 3. Back-to-Back Letter of Credit: This type of KWL/C involves two separate letters of credit. King Washington, as the issuing bank, issues the primary letter of credit based on the applicant's creditworthiness. The beneficiary then uses this letter of credit as collateral to secure a second letter of credit from another bank, known as the confirming bank. This technique enables intermediaries to facilitate trade between two parties. 4. Transferable Letter of Credit: In a transferable KWL/C, the beneficiary can transfer all or a portion of the credit to one or more secondary beneficiaries. This allows for the division of the payment obligation and allows intermediaries to facilitate multi-party transactions. 5. Deferred Payment Letter of Credit: Also known as a since letter of credit, this type of KWL/C allows the beneficiary to receive payment on a deferred basis. The payment is typically made at a predetermined future date after the presentation of documents complying with the terms and conditions of the credit. 6. Red Clause (Advancing) Letter of Credit: A red-clause KWL/C permits the beneficiary to receive partial payment in advance of the actual shipment of goods. This advance payment assists the exporter in meeting initial costs and expenses related to the preparation and shipment of the goods. It is important to note that the terms and conditions of each type of King Washington Irrevocable Letter of Credit may vary, depending on the specific requirements of the trade transaction and the negotiation between the parties involved.