This type of credit can be drawn against only upon performance of service or financial obligation default. It is a definite undertaking of the issuing bank. Similar to commercial LCs, standby. Payment is at sight, which means that the drafts and documents are honored, if in order, by making payment without delay. The draft honored by accepting it for payment at a future date.
Payment is delayed until the maturity of the draft.
Correct Name and Address 2. Sufficient Credit Amount 3. According to Terms of Sale 4. Points of Shipment and Destination are Correct 5. Insurance Coverage Requirements are Obtainable and According to Terms of Sale 6.