How much is the letter of credit fee? A complete analysis of letter of credit fees~

A letter of credit is a written document issued by a bank to an exporter (seller) at the request of an importer (buyer) to guarantee the payment of the goods. In the letter of credit, the bank authorizes the exporter to issue a bill of exchange of no more than the specified amount with the bank or its designated bank as the payee under the conditions specified in the letter of credit, and to attach shipping documents as required, and to collect the payment at the designated place on schedule.

All other fees related to letter of credit handling fee:

1. Certificate modification fee and certificate issuance fee: (usually borne by the customer, calculated based on the negotiated amount) US$200-500

2. Discrepancy fee: US$50-120

Note 1: Discount fees in Bangladesh: 75-150 USD, European countries such as France: 65-120 USD, surrounding areas such as Vietnam, South Korea: 65-85 USD, the deduction for discrepancies generally does not exceed 150 USD. The normal deduction is 65-85 USD

Note 2: The deduction for discrepancies is not calculated based on the number of discrepancies in each set of documents, but based on the size of the discrepancies in the entire set of documents. That is to say, the deduction for 10 discrepancies and 1 discrepancy in a set of documents is basically the same.

The major discrepancies we mention commonly include: exceeding the vessel date, exceeding the validity period, exceeding the delivery period, overloading, over-amount, etc.

Common minor discrepancies include: common spelling and punctuation errors in documents, and some documents that should be provided but are not provided.

3. Reimbursement fee: (based on the amount of the bill) ranging from US$50 to US$80

Bangladesh: about 110 USD, neighboring countries: 65-85 USD, Western European countries: 55-80 USD, American countries: 80-90 USD, the reimbursement fee is generally not more than 120 USD

4. Bank handling fee: USD 10-45 (charged by the other party’s bank)

Neighboring countries: 10-20, Bangladesh: 30-45 USD, Western Europe: 20-35 USD

5. Transfer fee (for transfer certificate): USD 200-500 (charged by the other party’s bank according to the amount of the document, and the charging standard varies from bank to bank)

6. Transfer fee (for transfer certificate): USD 200-300 (charged by the other bank according to the amount of the delivery document, and the charging standard varies from bank to bank)

7. Message fee: USD 80-150 (mainly used for inter-bank message during foreign exchange settlement)

Note: The sending fee for settlement is US$80-150. If you have any objection to the deduction details or send a message for other matters (such as reduction, increase, cancellation of letter of credit, etc.), the sending fee is US$15-25. The sending fee generally does not exceed US$150.

This is the end of the knowledge about letter of credit fees in this issue. If you want to get more information about letter of credit fees, please pay attention and we will continue to answer you~