Export documentary credit

You gain a considerable competitive edge, boost your export company's cash flow and risk management by using an export documentary credit. It can also serve as a financing instrument and is a globally used method of payment in international trade.

Your benefits

Use the export documentary credit when your customer is situated in a country, which is economically or politically unstable, or if the country's legislation or other statutes so require. The documentary credit can also be used to finance the term of payment.

  • You can be sure that you receive payment after the delivery.
  • You can get financing for your term receivables under certain conditions.
  • In an unconfirmed export documentary credit the buyer's bank undertakes to pay the receivable against documents conforming to the terms and conditions of the documentary credit. This means that the risk related to the buyer is eliminated.
  • Eliminate the risk related to the buyer's bank and country with an export documentary credit confirmed by Nordea.
  • All documentary credits are issued following the international documentary credit rules (UCP 600).

Energise your exports

An excellent method of payment as it helps your company to hedge against the risks related to export trading. The buyer's bank issues an irrevocable payment undertaking to your company provided that your company presents to the bank documents conforming to the terms and conditions of the documentary credit during its validity.

The repatriation of sales receivables involves risks. Even if the buyer usually settles its payment liabilities without cause for complaint, unstable political and economic circumstances may affect the buyer's liquidity and ability to pay. The use of a documentary credit diminishes the risks related to a foreign buyer. It can also be used to finance the term of payment.

We also recommend the use of a documentary credit when the trade relationship is new or the value of the trade is significant to the buyer or your company. The same goes for the manufacture of special goods made to order or a project delivery where the payment is made as deliveries are made or as the work progresses.

Through Trade Finance Global you will, among other things, be electronically advised of a documentary credit.



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