Import Letter of Credit Settlement Loan
Import Letter of Credit Settlement Loan is a form of a loan extended to a borrower by converting the outstanding import letter of credit document’s value either to a merchandise loan facility or to a term loan upon the fulfillment of the required eligibility criteria for a maximum period of one year when a customer is unable to clear the L/C documents due to shortage of cash flow. The customer couldn’t be allowed not more two times a year.
In addition to the General Eligibility Criteria, the customer shall fulfill the following specific requirements.
- The customer’s credit risk shall be grades 1, 2, or 3.
- The bank shall finance only import letter of credits opened at its end.
- The applicant shall not have any other long outstanding import letter of credit document arrived.
- The customer shall apply for a loan within five days after the bank advised the arrival of a letter of credit documents.