A Revocable letter of credit is a documentary credit that can be amended or canceled without prior notice to the receiver (sellers). As the revocable letter of credit can be amended, canceled, or revoked at any time and it cannot be confirmed.
2. A Revocable letter of credit is a documentary
credit that can be amended or canceled
without prior notice to the receiver (sellers). As
the revocable letter of credit can be amended,
canceled, or revoked at any time and it cannot
be confirmed.
3. Any letter of credit is by default irrevocable in
contract terms. If the issuing bank or the buyers
require a revocable letter of credit, it has to be
clearly mentioned in the LC contract explicitly. A
Revocable letter of credits an uncommon form
of LCs used in international trade. The prime
purpose of an LC is to offer assurance to the
second party.
4. The revocability clause of the LC remains
effective until the documents are not presented
for clearing with the advisory bank. Once the
supplier (second party) presents the
documents and meets the sales contract
terms, the revocability clause does not come
into effect.
6. By credit type and payment terms, the
revocable LC can take different forms. A letter of
credit can be backed by collateral or an
unsecured form. It can be transferable,
revolving, confirmed, or unconfirmed in nature.
A revocable LC is always unconfirmed by
definition.
8. The issued LC is revocable in nature and can be
transferred to the other beneficiaries. The credit
transfer becomes highly unlikely as the
revocability clause limits its functionality.
16. Creating Value with its fast and efficient Solutions
At Bandenia Challenger Bank, we are committed to
delivering trade and financing solutions in the best
interest of our customers. Carrying out smooth and
efficient transactions with diligence and efficacy
has been our driving force since day one.
17. +44 20 3286 7867
contact@bandeniachallengerbank.com
www.bandeniachallengerbank.com
Fifth Floor, Suite 23,
63/66 Hatton Garden
EC1N 8LE London, UK