Trade Finance is instrument to support Trade and Commerce, both internationally and domestically to Clients. Line of Credits - different types according to customer suitability.
Letter of Credit: A letter of credit is a written instrument issued by the NID Bank at the request of a customer (applicant) in favor of a seller (beneficiary) undertaking to honor the documents or drafts drawn by the seller in accordance with the terms and conditions specified in the credit, within a specified time. Thus, the credit is made available to the seller against the delivery of certain specified documents. When the credit stipulates payment of money on presentation of documents to the NID Bank, the L/C is called Sight LC. If the credit stipulates that the payment will be made on the due date, the L/C is called a usance L/C. Furthermore, if a letter of credit is opened in respect of a trade transaction taking place within the country, then the L/C is called inland L/C. If a letter of credit is opened in respect of an import transaction, then the L/C is called Import/Foreign L/C; if it is opened in respect of an export transaction, then it is called Export L/C. Letter of credit is also known as documentary credit. The issuance of letter of credit shall also cover Standby Letters of Credit (SBLC).
1. Inland Letter of Credit 2. Foreign Letter of Credit 3. Revocable 4. Irrevocable 5. Confirmed 6. Unconfirmed 7. Transferable 8. Non-Transferable 9. Revolving 10. Back-To-Back Letter Of Credit 11. Standby Letter Of Credit 12. Red Clause Letter Of Credit 13. Green Clause Letter Of Credit
1. Bid Bonds. 2. Performance Guarantees. 3. Advance payment Guarantees. 4. Financial Guarantees. 5. Deferred payment guarantees. 6. Retention guarantees
