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Letter of Credit (L/C)

Letter of Credit (L/C) · End-to-End Issuance & Negotiation

The letter of credit (L/C) is the standard payment method for high-value export orders, yet "document discrepancies" that lead to rejected negotiations remain a chronic industry pain point. SBK digitizes the entire L/C lifecycle — from issuance to checking, document presentation and negotiation — automatically verifying document compliance against a UCP600 standard-clause library so that negotiation clears on the first attempt.

5
Workflow Stages
50+
UCP600 Standard Clauses
≤24h
Document Compliance Check
Capabilities

The Full L/C Workflow, Digitized

Issuance → checking → preparation → presentation → negotiation → settlement, fully traceable end to end

📝 L/C Data Capture

Paste SWIFT MT700 messages directly and extract key fields (amount, shipment date, negotiation period, clauses) into structured data

Document Compliance Check

Compare the invoice, packing list, bill of lading, certificate of origin and insurance policy against each L/C clause, with discrepancies highlighted

🏦 Negotiating-Bank Profiles

Manage partner negotiating-bank profiles, including SWIFT code, negotiation rates, duty deposits and contact details

📅 Key-Date Alerts

Calendar-day alerts for shipment date, negotiation period and L/C expiry, preventing costly lapses

💰 Negotiation-Fee Accounting

Negotiation charges, cable fees, SWIFT fees and discount interest are calculated using each negotiating bank's preset rates

📚 UCP600 Clause Library

A library of 50+ explained UCP600 standard clauses lets new staff learn while checking credits, cutting training costs

trade.shangbangke.com/lc/LC-MT700-8821Checking
LC
L/C Checking · MT700
PasteReport

L/C clauses vs contract clauses

FieldL/CResult
L/C AmountUSD 96,000OK
Latest Shipment2026-04-30OK
Expiry2026-05-15OK
Soft ClauseClient Cert.Soft

L/C Checking — Your First Line of Defense

When an L/C arrives, check it first: are the clauses consistent with the contract, is the shipment date enough to prepare goods, is the negotiation period reasonable, and are there any soft clauses (deal-breakers such as a buyer's inspection certificate)? SBK captures the L/C's key fields as structured data and automatically compares them with the contract to surface differences, cutting checking time from two hours to twenty minutes.

  • Paste SWIFT MT700 messages and auto-parse the fields
  • Compare L/C clauses against contract clauses for differences
  • Detect soft-clause keywords (such as client certificate)
  • Export checking reports for managers or owners to review
trade.shangbangke.com/lc/doc-checkPresentation
D
Five-Document Consistency
ExportRe-check
22Passed
2Minor
1Major

Invoice / Packing / B/L / C.O. / Policy

Check ItemSeverity
Invoice amt = L/C amtPass
B/L date ≤ latest shipmentPass
B/L consignee spellingMinor
C.O. country nameMismatch

Five Compliant Documents = a Higher Negotiation Pass Rate

Negotiating banks scrutinize documents rigorously: invoice amount vs. L/C amount, B/L shipment date vs. L/C shipment date, packing-list total packages vs. B/L total packages, certificate-of-origin country vs. invoice origin. Any mismatch means rejection. SBK automatically cross-checks the key fields of all five documents and lists every discrepancy.

  • Auto-compare five documents (invoice / packing list / B/L / certificate of origin / insurance policy)
  • Cross-check amount, package count, gross/net weight, shipment date and port item by item
  • Flag discrepancy severity in red, yellow and green
  • Use the check report as a presentation preparation checklist
trade.shangbangke.com/lc/negotiation/trackIn Progress
S
Negotiation → Settlement
ReconcileMilestones

Five settlement milestones

Present
04-22 Done
Negotiate
04-23 Done
Advising Pay
Processing
Issuing Pay
Pending
Credited
Est. 05-02

Full Tracking from Negotiation to Settlement

After documents are presented to the bank for negotiation, you still wait for the issuing bank to pay — a week at most, two days at best. SBK records every milestone: presentation date → negotiation date → advising-bank payment date → issuing-bank payment date → exporter account credit date — fully transparent for easy finance reconciliation.

  • Track the status of five settlement milestones
  • Accrue negotiation-advance interest daily
  • Reconcile the credited amount against the L/C amount
  • Record the workflow for accepting discrepancies, rejection or re-presentation
Use Cases

L/C in Action

Middle East buyer, 100% L/C at sight

A buyer opens a USD 2M sight L/C; checking reveals the 30-day shipment window is too tight, so the salesperson asks the buyer to amend the credit and extend it by 15 days.

Avoiding soft clauses

An L/C contains a soft clause requiring "negotiation against the buyer's inspection certificate"; the system flags it, and the salesperson declines and requests an amendment.

Five documents pass compliance on the first try

A pre-presentation compliance check shows all five documents green; the negotiating bank pays normally three days later with no discrepancies.

Accept the discrepancy vs. reject

A shipment one day late creates a discrepancy; assessing the buyer's reputation, the salesperson decides to have the buyer accept the discrepancy rather than reject the documents.

Related Features

End-to-End L/C Integration

An L/C touches five core documents: contract, PI, bill of lading and settlement

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