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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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