Advising Bank

An Advising Bank receives the letter of credit (L/C) from the issuing bank and forwards it to the beneficiary (seller). The bank authenticates the L/C and ensures its legitimacy before delivering it to the beneficiary.

The advising bank’s role

It verifies the authenticity of the letter of credit issued by the issuing bank. It forwards the letter of credit to the beneficiary. It ensures that the terms and conditions are clear and accurate.

The Advising Bank does not guarantee payment. It only confirms the letter’s authenticity. It communicates any amendments to the beneficiary. It provides guidance on compliance with the letter’s terms.

Examples of significant instances include:

• Verifying the issuing bank’s credentials
• Forwarding the letter of credit to the beneficiary
• Communicating amendments
• Providing compliance guidance

The Advising Bank ensures clarity and accuracy in all communications.