New York Dubai Investment Trust

Documentary Letters of Credit (DLC) are typically utilized by companies seeking to reduce the risks associated with exporting into and/or importing from foreign markets. The use of documentary letters of credit reduces the risk to both buyer and seller in an international sale and can be used for one-time or recurring transactions. The title documents to a shipment and the payment for the same are exchanged between the exporter’s and importer’s banks, respectively. As long as the shipment meets the standards established between the parties, payment is guaranteed.  The main benefits of utilizing a DLC are:

 

• The exporter can expand its revenue base by selling into foreign markets with limited payment risk.

• The importer can buy from foreign markets with limited risk of non-shipment.