Frequently asked questions about letters of credit
The topics exporters and importers ask about most.
Basics
Process
Technical
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Causes of discrepancies
A single word can stop your collection
A discrepancy usually comes not from a big mistake but from a small detail slipping through. A date off by one day, one word spelled differently on the invoice is enough. ISBP 821 is hundreds of lines of rules; knowing which one applies to which document takes years. Five of the six causes below are wording- and document-related — meaning that, read with the right eye, they can be prevented before the credit is issued.
Inconsistent documents
A single figure or word differing across invoice, bill of lading and policy is a discrepancy.
Missed deadline
Missing the presentation or shipment period by one day jeopardizes the whole collection. There is no undo.
Unworkable condition
A clause buried in the text that is operationally impossible. The moment you accept it, you're trapped.
Missing or wrong document
A missing or incorrectly prepared document halts payment on its own.
Description mismatch
If the goods description doesn't match the credit exactly, the bank counts even the smallest gap as a discrepancy.
Confirmation or bank risk
If the issuing bank doesn't pay and there's no confirmation, the goods are gone and the money never came. The risk is all yours.
Solution
Catching these details is a matter of expertise
Cleaning the wording, analysing confirmation, and document preparation and presentation follow-up — all three take years of field knowledge. That is exactly what we do: you focus on your product, we chase the rules.
Show us the LC text before you accept it
Once you approve the text, reversing it is expensive. If a letter of credit has been issued in your favor, let's run it through a free assessment before you sign.