Export Documentary Credits

Benefits and features

• Secures payments

• Enables you to negotiate terms for delivering goods and payments

• Enables you to obtain pre-shipment or post shipment finance

A DC is an "undertaking" by a bank (Issuing Bank), on behalf of your customer (Applicant), to make payment for goods or services provided by you (Beneficiary) within a prescribed time limit and against stipulated documents such as proof of shipment. The use of DCs is governed by internationally recognised rules (UCP500).

How do Documentary Credits work?

Advise your DC through HSBC and we will email you the text of the credit for easy reference and hold the DC (a negotiable instrument) in safe custody for you. Our expertise will ensure that your documents are as discrepancy free as possible, as we are fully aware that consistency and accuracy are paramount in preparing DC documents when the time comes to presenting your documents.

Financing for your business

With an Export DC in hand, it will also be easier for you to obtain pre-shipment finance in the form of a Packing Credit, or post-shipment finance where the documents under the DC are negotiated.

New business opportunities

Expand your business with new opportunities made possible by Documentary Credits.

• New business partners
  Structured and clearly defined terms and conditions in the DC can provide the peace of mind necessary to do   business between unfamiliar business partners.

• New countries
  Expand your markets with the secured payments of Documentary Credits. If you are not comfortable with the   issuing bank, we can help you to add our confirmation to the credit.

Different types of DCs

There are different types of DCs. Documentary Credits can be either irrevocable or revocable. Revocable credits mean that the buyer can unilaterally change/cancel it after issuance. You should always insist on an irrevocable DC so that it cannot be cancelled without your prior consent. If you're unsure which one to use, try our quick reference DC comparison table.

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