A letter of credit is a formal agreement, made by both parties, to pay for imported goods and services. It’s a guarantee for suppliers that they’ll receive payment, making trade deals less risky and more attractive for them.

When Barclays issue a letter of credit, we’re agreeing to pay the seller a set amount within a specified timeframe, as long as they provide the necessary documents.

Be certain of the deal

No amendments or cancellations can be made without everyone’s agreement, and payment is only processed once exact terms and conditions are met. This means exporters can be confident that they’ll receive payment, and importers have a stronger buying position to work from.

More negotiating power

Because importers are offering a secure transaction, they can ask the exporter to cover more of the trade costs. This is particularly valuable when dealing with new, unknown suppliers

Any amount, any currency

Payments can be agreed for any amount and in any approved, freely-traded currency.

Key benefits

  • A strong bargaining tool for importers, creating more opportunity to negotiate 
  • Clear terms
  • Currency flexibility
  • More control and enhanced credit position
  • Improved cash flow
  • Leads to more competitive deals
  • Safe and flexible
  • Payments can be made in any approved freely-traded currency

Contact us

Talk to us about your trade finance needs on