Introduction
Domestic L/C, a written commitment to the seller issued by Bank of China on request of the buyer in a domestic trade, is a settlement method by which the seller is paid against documents complied with terms and conditions of L/C. Various financing services can be provided to meet the customers' needs under the domestic L/C.
Features
The product can meet customers' demand for domestic trade settlement and financing.
Target Customers
1. The buyer and the seller are not familiar with each other in a domestic trade, hoping to enhance the credibility of trade by bank's L/C;
2. The buyer and the seller have no sufficient working capital thus need trade finance.
Application Qualifications
1. Customers have the corporate business license that is legally approved, registered and annually checked, and other valid certifications sufficient to prove the legitimacy and scope of its operation;
2. Customers have the loan card;
3. Customers have the account opening permit and have opened the settlement account with Bank of China;
4. Customers who have paid full deposit, or put T- bonds, bank deposit receipts, or other bank acceptance drafts acceptable to Bank of China in full pledge, or whose credit risks primarily attribute to the financial institution credit risks and occupation of credit line in financial institutions (such as the credit risk under the bank guarantee) can apply for the domestic L/C, and are not restricted by customers' credit rating and other acceptance requirements;
5. Customers who do not belong to the above-mentioned groups yet apply for the domestic L/C will be not restricted by customers' credit rating, but they should have the credit line in Bank of China.
Process
1. The buyer submits the Application for Issuance of L/C to Bank of China, and Bank of China will issue the L/C against the deposit or credit line after approval;
2. After the seller receives the advice of L/C, the advising bank can provide financing service such as packing loan on request of the seller;
3. The seller delivers goods and submits related documents to the transmitting bank under terms of the L/C, the transmitting bank forwards the documents to the issuing bank for payment; meanwhile financing services including the negotiation or bill advance can be provided at the request of the seller;
4. Upon receipt of the documents, the issuing bank makes payment to the seller after examination and approval, meanwhile it can handle bill advance on request of the buyer.
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