Working Capital Management Interview Question:

Explain what are the advantages of a LC to an exporter?

Submitted by: Administrator

Advantages of Letter of Credit to an Exporter:

1) Exporter is guaranteed payment upon presentation of specified documents.

2) It eliminates the risk of dealing with an unknown importer in a different country.

3) It becomes easier for the exporter to secure pre order financing.

4) Importer cannot refuse payment by raising a complaint about the goods.
Submitted by: Administrator