Letter of Credit

Q.

What is a letter of credit ? Why does an exporter need this document?

Q.

What is a trade payment?

Q.

List and explain various incentives and schemes that the government has evolved for promoting the country's export.

Q.

Why do exporters demand letters of credit?

1. Maximise the risk of non-payment by importers.

2. Minimise the risk of non-payment by importers.

Q.

Why does an exporter need 'Letter of Credit'?

Q. Explain the following terms used in external trade:

Q.

A___ is a letter from a bank guaranteeing that a buyer will pay the seller on time.

1. Letter of credit

2. Bill of entry

3. Bill of lading

4. None of the above