Provide assurance to your suppliers when they present the required documents
Take advantage of new growth opportunities with a Letter of Credit issued by the best trade finance bank in Singapore. Our award-winning trade solutions and "AA-" and "Aa1" credit ratings have helped companies all over Asia provide assurances of payment that strengthen new business relationships. And because you can apply for a Letter of Credit online through IDEAL™, our online banking platform, you can also streamline efficiencies within your organisation.
Why choose DBS Letter of Credit Issuance?
Common types of Letter of Credit:
Sight Letter of Credit
The issuing bank will honour the payment at “sight”, which means the payment will be made once the documentation received is in order
Usance Letter of Credit
The issuing bank will accept the draft once all documentation received is in order and agree to pay on the maturity date
Red Clause Letter of Credit
This allows the issuing bank to make partial advance payment to the seller upon receipt of the documentation. This is commonly used in manufacturing industries
This is usually used by middleman traders who do not enjoy a credit facility. DBS will transfer the Export Letter of Credit in favour of the ultimate seller at the request of the middleman, who will then sell the goods under the Export Letter of Credit
Back-to-Back Letter of Credit
This is used by middleman traders with a credit facility. The master Export Letter of Credit from the buyer’s bank backs the issuance of an Import Letter of Credit. Proceeds from the master Export Letter of Credit are then used to pay the bank under the Import Letter of Credit
This is typically used to assure the applicant will meet the payment obligations or contractual performances specified. Another commonly used product in this situation is a Banker’s Guarantee
1/8% per month. Min two months or SGD 80, whichever is higher
Pre-advice of Letter of Credit (Telex/SWIFT)
Usance Letter of Credit acceptance/deferred payment commission
1/8% per month from the expiry date to the due date. Min SGD 80
USD 80 (or SGD 110)
– Extension expiry/validity
1/8% per month on outstanding balance. Min SGD 80
1/8% per month on the increment. Min two months or SGD 80, whichever is higher
Withdrawal of application before issuance
Processing fee under advance payment arrangement**
No, you must obtain a credit facility with DBS before we can issue a Letter of Credit to your sellers. Please call us at 1800 222 2200 (if you’re in Singapore) or +65 6222 2200 (if you’re calling from overseas) should you require a credit facility.
Yes. We issue the Letter of Credit and advise through our network branch or agent bank in the event that we do not have a branch or office in the seller’s country.