Letter of creditAfter the buyer and seller sign the completed a contract, they must proceed to the payment. often, the buyer and the seller do not know each other very well, they have to be careful in buying bán.ng buying your want to receive items before paying out when resellers wanting to get money before delivery. to ensure for both parties, they use letters of credit.Letter of credit is a tool of the Bank can guarantee to the seller receives money when they haven't enough paperwork to the Bank that has agreed to the transfer. on the other hand letters of credit guarantee for buyers need not pay in advance when the seller delivered the goods
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