Secure, Reliable & Globally Accepted Trade Finance for Importers and Exporters
A Letter of Credit (LC) is one of the most trusted and widely used trade finance instruments in global commerce. It provides payment assurance to suppliers, reduces risk for both parties, and enables businesses to import goods smoothly without upfront cash.
Amanex Group helps companies secure LC Facilities from leading UAE banks, ensuring compliant structuring, competitive pricing, and high approval probability — tailored to your trade volume, supplier requirements, and financial profile.
WHAT IS A LETTER OF CREDIT (LC)?
A Letter of Credit is a bank guarantee of payment issued on behalf of the buyer (importer) to the seller (exporter). The bank commits to paying the supplier once all shipping and commercial documents are submitted as per LC terms.
LC = Bank’s Payment Guarantee to Supplier
This builds trust, enables international trade, and protects both parties from financial risk.
WHO IS AN LC FACILITY FOR?
LC Facilities are ideal for businesses involved in international or domestic trade, including:
- Importers & exporters
- Trading companies
- Wholesalers & distributors
- Retail & FMCG companies
- Industrial suppliers
- Automotive & spare parts traders
- Electronics & equipment importers
- Construction material suppliers
Any business that imports goods and needs secure, bank‑backed payment assurance benefits from an LC Facility.
KEY BENEFITS OF LC FACILITY
1. Supplier Trust & Confidence
Suppliers receive a bank guarantee, not just a buyer’s promise.
2. No Upfront Payment Required
You don’t need to pay the supplier immediately — the bank does.
3. Smooth Import Operations
Goods are shipped without delays or disputes.
4. Reduced Risk for Both Parties
- Supplier risk: eliminated
- Buyer risk: controlled through document verification
5. Supports Large Import Volumes
Ideal for high‑value shipments and bulk orders.
6. Flexible LC Types
Choose from Sight LC, Usance LC, Back‑to‑Back LC, and more.
HOW AN LC FACILITY WORKS
Step 1 — Buyer Requests LC from Bank
Bank evaluates buyer’s financials and approves LC limit.
Step 2 — Bank Issues LC to Supplier’s Bank
Supplier receives a guaranteed payment commitment.
Step 3 — Supplier Ships Goods
Supplier ships goods and submits documents to their bank.
Step 4 — Bank Verifies Documents
Bank checks:
- Bill of Lading
- Commercial Invoice
- Packing List
- Certificate of Origin
- Insurance
- Other LC terms
Step 5 — Bank Pays Supplier
Payment is released once documents match LC terms.
Step 6 — Buyer Repays Bank
Buyer repays bank immediately (Sight LC) or after 30–180 days (Usance LC).
TYPES OF LC FACILITIES
1. Sight LC
Bank pays supplier immediately upon document submission.
Ideal for:
- Fast‑moving goods
- High‑trust suppliers
2. Usance LC (Deferred Payment LC)
Bank pays supplier immediately, but buyer repays bank after 30–180 days.
Benefits:
- Extended credit terms
- Improved cash‑flow
3. Back‑to‑Back LC
Used when the buyer needs to issue an LC to their supplier based on an LC received from their customer.
Ideal for:
- Traders
- Re‑exporters
4. Standby LC (SBLC)
Acts as a financial guarantee rather than a payment instrument.
Ideal for:
- High‑value contracts
- Performance guarantees
5. Transferable LC
Allows the beneficiary to transfer LC rights to another supplier.
Ideal for:
- Trading intermediaries
6. Revolving LC
Automatically renews for repeated shipments.
Ideal for:
- Long‑term supplier relationships
ELIGIBILITY CRITERIA
Banks typically require:
- Monthly turnover: AED 300,000 – 500,000+
- Active import operations
- 6–12 months bank statements
- Clean AECB score
- Stable cash‑flow
- Valid trade license
- VAT returns (if applicable)
- Supplier contracts / proforma invoices
DOCUMENTS REQUIRED
- Trade License
- MOA / Share Certificate
- Passport, Visa, Emirates ID
- 6–12 months bank statements
- Supplier proforma invoice
- Purchase order
- Shipping documents
- VAT returns
- Financial statements
USE CASES FOR LC FACILITY
- Importing goods from international suppliers
- Large‑scale trading
- High‑value shipments
- Contract‑based imports
- Re‑export operations
- Industrial raw materials
- Machinery & equipment imports
EXAMPLE SCENARIO
A trading company imports electronics worth AED 800,000 monthly.
They secure:
- AED 1,000,000 LC Facility
- Tenor: 90 days (Usance LC)
This allows them to:
- Import goods without upfront payment
- Sell inventory
- Repay the bank after receiving customer payments
- Increase import volume and expand business
LC FACILITY VS TR FACILITY
| Feature | LC Facility | TR Facility |
|---|---|---|
| Purpose | Supplier payment guarantee | Post‑import financing |
| Payment | Bank pays supplier | Buyer repays bank |
| Tenor | 0–180 days | 30–180 days |
| Ideal For | Import assurance | Clearing goods |
HOW AMANEX GROUP SUPPORTS YOU
1. Eligibility Assessment
We analyze your import volume, supplier terms, and financials.
2. Facility Structuring
We determine the ideal LC limit, tenor, and LC type.
3. Documentation Preparation
We prepare:
- Financial summary
- Business profile
- LC justification
- Compliance documents
4. Bank Submission
We submit your file to multiple banks for competitive offers.
5. Negotiation
We negotiate:
- Higher LC limits
- Lower LC charges
- Better repayment terms
6. Approval & Activation
We coordinate with the bank until the LC facility is activated.
WHY BUSINESSES CHOOSE AMANEX
- Strong relationships with UAE banks
- Expertise in trade finance structuring
- High approval success rate
- Transparent advisory
- Fast processing
- End‑to‑end support
